Improvements in the SDDS and more transparency regarding Article IV reports, letters of Intent and policy papers will certainly improve risk assessment. This could help prevent economic problems from turning into crises and to prevent contagion to other countries. Progress has to be made as regards incentives for sound management. The creation of the CCL is a step in this direction. Designing appropriate incentives is the more effective way to make Members adopt more prudent debt management, effective banking supervision… Given the large number of institutions and fora involved in the efforts aiming at a better global financial architecture, the creation of the Financial Stability Forum reflects an important effort to coordinate work in progress and identify issues not yet addressed. THE EUROPEAN MONETARY UNION WILL YIELD A SUBSTANTIAL CONTRIBUTION TO BETTER ECONOMIC AND MONETARY EQUILIBRIUM IN THE WORLD The introduction of the euro six months ago is the other major event I would like to deal with now. The irreversible nature of this change has convinced an increasing number of political and economic actors that the success of the euro is a necessity for Europe. It is a keystone of the single market. It is clear that, now and for the future, we have to face a number of challenges to make this success sustainable.
Agents attend the monthly briefing in Threadneedle Street ahead of each policy meeting, so information from their contacts is fed directly into the heart of the policy process. I know I speak for all of my colleagues on the MPC when I say that we really do find this a crucial barometer of current events, so I hope you will feel that a short while with our Agents once or twice a year is time well spent! Financial stability and Enron I now turn to my final subject tonight - that of the Bank's role in ensuring financial stability. Responsibility for the day-to-day supervision of banks passed from the Bank of England to the Financial Services Authority in 1997. But as the central bank we still have a key role in overseeing the stability of the system as a whole. In this guise we meet on a monthly basis with HM Treasury and the FSA in the so-called tripartite Standing Committee, to review the risks facing the UK financial system and take stock of any actions which may be required to address them. Keeping close to the FSA is particularly important. To this end, I sit on the FSA Board, and Howard Davies is a member of the Bank's Court. Of course, as I have no need to remind you here, with the border of the euro area just a few miles down the road, we cannot look at the UK system in isolation from the wider international financial markets.