When there are no restrictions limiting the central bank’s choice of policy instruments, and when the culture of price stability has taken root, the Bank of Israel will be able to include reference to the financial markets among its functions, with the aim of contributing to their stability. BIS Review 57/2001  5
Informal fora are invaluable for “softening the ground” in areas where decisionmaking processes remain largely national – whether in forging a consensus on prudential standards and codes, or facilitating the coordination of economic policies when appropriate. How did this system of formal and informal elements fare during the crisis? Let me highlight one strength and two areas that are still in need of strengthening.