This conference assigns such practical principle of policymaking the theoretical dignity that it deserves. The central question here is how a monetary authority profoundly committed to the objective to which it is mandated, should incorporate in its rule-based behaviour past deviations of inflation from levels that it considers consistent with price stability.
Tight coordination between macro- and microprudential policies as well as between the participating institutions needs to be ensured. This should also extend to the Ministry of Finance as it has the ultimate responsibility for financial policy and is the representative of the taxpayer. Macroprudential authorities need to ensure transparency and clear communication of decisions and decision-making processes.