Historians tell us that urbanisation also contributed to increased trade between Europe’s regions, which made prices more responsive to distant changes in demand. Another topical issue I will elaborate on – the link between global excess liquidity and financial stability – also has its roots in 16th century Spain.
Rising inflation and the dependency on gold and silver imports are mentioned as causes of multiple bankruptcies and economic crashes. 6 Following the agenda set by the 16th century globalisation episode, my speech is divided into two main parts. The first part deals with the effects of globalisation on inflation dynamics and price stability from a monetary policy perspective.