4  As financial markets stabilize, interest rates out the yield curve (particularly on government instruments) would be expected to return to more normal levels. 5  Although it isn't a guiding principle, close coordination between the central bank and the treasury is also necessary.
This will avoid confusion and help maximize the effectiveness of any measures that are taken to ease credit conditions and stimulate the economy. Just as the boundary between monetary stability and financial stability becomes increasingly blurred in the midst of a financial crisis, so too does the boundary between monetary and fiscal policy actions.