Fourth, I will briefly discuss monetary challenges faced by emerging economies in the current context of the extraordinarily accommodative monetary stances of advanced nations. And finally, I will draw some conclusions. As usual, my remarks are entirely my own and do not necessarily reflect the views of the Bank of Mexico or its Governing Board. What positive impacts can monetary policy have?
The most indisputable contribution monetary policy can make to the wellbeing of any society is price stability. As succinctly stated by Milton Friedman, “inflation is always and everywhere a monetary phenomenon,” and hence, monetary policy can control it. 1 The benefits of price stability are well known. It provides a favorable framework for efficiency and economic growth.