Realizing the full potential of central banking  The ultimate objective for central banks is to realize stable and sustainable growth. Operationally, this is going to be achieved through the stability of prices and the financial  6  BIS central bankers’ speeches  system. Having said that, it must also be stressed that this goal is not pursued in a vacuum.
Such growth can only materialize through the intricate interaction among various economic agents – households, firms, financial institutions and the government – each dynamically pursuing their own goals. While the central bank is probably the actor most responsible for ensuing price stability in a steadily expanding economy, some conditions must be met before the central bank could make the most of its potential.