Michel Camdessus Central Banking Lecture – Washington, 14 September 2022 Ethics of currency: a possible guide for central bankers? Speech by François Villeroy de Galhau, Governor of the Banque de France  Press contact: Mark Deen (mark.deen@banque-france.fr), Déborah Guedj (deborah.guedj@banquefrance.fr)  Page 1 sur 10 Ladies and Gentlemen, It is my great pleasure to be in Washington with you today, and to deliver this speech in honour of Michel Camdessus. I would like to take this opportunity to pay a special tribute to him, and express my personal gratitude. Michel is not only one of my predecessors as a Governor of the Banque de France, but also a friend of mine and – yes – a master. My speech was prepared with his precious help, so today you can almost enjoy a “Camdessus Lecture by Michel Camdessus himself”. The theme we chose together, the “ethics of currency”, has guided him throughout his career. In the murky waters that we central bankers are navigating, it should more than ever serve as a golden thread. I will briefly discuss the reasons why I dare to talk about the ethics of currency (I), then elaborate on the golden triangle of trust today (II) and finally raise the question as to whether the international dimension of trust can still inspire us (III). I. Why I dare to talk about the ethics of currency Before going any further, we must find a common definition of “ethics”. Is it possible to take this word as a synonym for “morality”?
12  BIS Review 159/2010  Overall, the impact of the upward revision in the food price assumption is offset by lower-thanexpected non-food inflation, leading to an unchanged inflation forecast at 7.5 percent for end2010. Similarly, the impacts of factors affecting the medium-term inflation outlook have balanced each other out, and consequently there has not been a significant revision in the forecasts. I think comparison of the forecasts by the ones in the previous Report period would help us to better understand the changes in forecasts. As I have mentioned earlier, considering a relatively stronger recovery in the domestic demand outlook and the second quarter GDP data, our output gap estimates have been revised upwards as of the second quarter of 2010 (Figure 29). The impact of the upward revision in the output gap was largely offset by the downward revision in the underlying inflation trend. Consequently, there has not been a significant change in medium-term inflation forecasts and the monetary policy outlook compared to the previous Report (Figure 30). In sum, assuming that policy rates would stay constant for sometime and remain at low levels for a long period, our revised forecasts suggest that aggregate demand conditions would continue to support disinflation for a while. Under current conditions, inflation is expected to follow a marked downward trend over the next two quarters and decline to levels consistent with medium-term targets as of mid-2011, as the adverse impact of the temporary price movements taper off.