His contribution goes back to at least 1936, when he made a lengthy submission to the Royal Commission on the Monetary and Banking Systems in Australia. The first sentence of that submission reads: ‘The ultimate purpose of monetary policy is to enable the economic system to achieve the optimum use of available resources as far as this is possible’.
In what follows, let me focus on three market segments which, in the euro area, are particularly relevant for the monetary policy transmission mechanism. These segments have been specially important during the financial crisis and this is why our monetary policy measures have focused on them: first, the interbank market; second, the covered bond market; third the sovereign debt market.