If the Bank aims for a low but positive rate of inflation, and imported goods prices are falling, the prices of other goods and services will have to rise faster to compensate. So for example, the prices of imported goods and services fell by 13% between 1995 and 2004, while the prices of other consumer goods and services rose, on average, by around 20%. To produce this result, and keep overall inflation close to target (as it was), the Bank was probably able to keep interest rates lower than they might otherwise have been. That’s why people sometimes say that the falling world prices resulting from globalisation have acted as ‘favourable tailwinds’ for central banks over the past decade. And why, over the last couple of years, there have been worries that high and volatile energy prices would provide ‘strong headwinds’. Second, there have been important innovations in the practice of monetary policy over the past decade. These have not been confined to the UK - there is an international traffic in good monetary policy ideas, as in almost everything else. So while the UK was a pioneer in some respects, our current approach to policy is more fairly described as close to international best practice. There’s been a widespread move to give central banks more independence, with clear objectives and a strong commitment to transparency and accountability.
Muhammad bin Ibrahim: Innovative financial inclusion Opening remarks by Mr Muhammad bin Ibrahim, Governor of the Central Bank of Malaysia (Bank Negara Malaysia), at the Global Symposium on Innovative Financial Inclusion, Kuala Lumpur, 21 September 2016. *  *  *  While the global economy is still recovering from the Global Financial Crisis, the focus on boosting global growth has never eclipsed the financial inclusion agenda. In fact, policymakers continue to recognise the importance of financial inclusion and have accorded it as a global priority to address the widening income inequality gap, to promote the economic empowerment and protection of low income households and SMEs and to unlock the growth potential of the fast-expanding middle class population. Expanded opportunities to save securely, to invest in productive activities and to protect against unforeseen shocks, would meet the needs of the underserved. This would drive domestic demand, a key engine of growth for many economies. Between 2011 and 2014, the World Bank estimates that 500 million people have gained access to formal financial services for the first time. If our efforts continue, we are on our way to assisting the remaining 2 billion adults that remain financially excluded. A succession of technology breakthroughs combined with the ubiquity of mobile devices present significant opportunities to scale up financial inclusion to an unprecedented level.