New tools may be needed, as well as an organisation of policymaking such that the interactions between macro-prudential regulation and supervision and monetary policy are brought together. Allow me to elaborate on this last point. Exploring the nexus between macro-prudential regulation/supervision and monetary policy As just mentioned, price stability and financial stability are interconnected.
While it is certainly true that financial stability does not necessarily imply price stability and vice versa, the recent crisis has made it clear that large-scale financial instabilities can significantly affect the development of prices in the economy. Therefore, a natural question arises as to whether monetary policy and macro-prudential supervision and regulation are related and interlinked with each other.