Thus, the answer to the title of this speech – "Does stabilizing inflation contribute to stabilizing economic activity?" – is, for the most part, yes. A key policy recommendation from the past three decades of research in monetary economics is that monetary policy makers must always keep their eye on inflation and emphasize the importance of price stability in their actions and communications.
Figure 2: Daily Volumes in Selected U.S. Money Markets  Daily Volumes in U.S. Money Markets  Billions USD 800  $ billion  700 600 500 400 300 200 100 0  $ billion  $ billion Est.