The development of both the role of central banks in financial stability and thinking about appropriate responses to financial imbalances, such as excessive movements in asset prices, is one of the key challenges that central banks face today.
The activities of central banks striving to strengthen financial stability are related - on the one hand - to the monetary policy function, aimed at preserving price stability and thereby contributing to sustainable growth in the long term. On the other hand - central banks’ macro-oriented financial stability functions also relate to micro-level prudential supervision as both are geared towards safeguarding financial stability.