It would be desirable that innovations led by the private sector continue to evolve under the appropriate code of conduct, thereby improving market functioning. The public sector should endeavor to align the private sector’s incentives appropriately to support further market innovation and sound functioning of the foreign exchange market.
Thus central banks are charged with limiting system-wide distress and, ultimately, avoiding its negative consequences for the real economy. In the past, it was not thought necessary to separate monetary policy from the task of providing financial stability. It was thought that price stability in the market for goods and services would be sufficient to ensure financial stability in asset markets.