In this situation, a strict adherence to a single framework or model to the exclusion of alternatives would be unwise. It would carry the risk of making substantial policy mistakes if the framework used for policy turned out to neglect those aspects of economic behaviour which ultimately came to play an important role. In this context, a well-designed monetary policy will be “robust”.
This year’s choice of topic is motivated by our desire to be transparent in our conduct of monetary policy. International financial crisis Allow me first to make few remarks on the global economic developments. By now we are all aware of the financial crisis that is afflicting the world economy and its adverse impact on economic growth world-wide.