I am especially pleased to see that, besides the many banking supervisors and bankers who are taking an interest in the Basel discussion paper, academic economists are likewise joining in the debate on the new supervisory rules more vociferously than they did in the past. Hence today’s gathering also helps to foster the dialogue between academics and practitioners.
In these conditions, in the face of large adverse shocks, the ECB’s policy response will, as appropriate and grounded in a careful proportionality analysis, include especially forceful monetary policy measures. In addition, closer to the effective lower bound, it may also call for a more persistent use of its monetary policy instruments.