This significant step frontloads the transition from the prevailing accommodative level of policy rates towards levels that will enable the timely return of inflation to our two per cent medium-term target. Current challenges of monetary policy Let me now elaborate a bit more on some of the most important challenges that Monetary Policy faces today. The crux of the matter is that the pandemic and the war in Ukraine have created significant macroeconomic uncertainty, associated with a high degree of output growth and inflation volatility. In such an environment of lasting output and inflation volatility and uncertainty, one of the main questions is how governments and central banks should formulate policy. Fiscal policy will be critical in improving the robustness of our economies. With debt ratios at record highs, expenditure should be targeted and prioritise social cohesion and productive green investments that will help assure long-term prosperity and develop fiscal flexibility needed to cushion future shocks. Non-targeted fiscal policy will counteract monetary policy efforts to contain inflation. At the same time, central banks must safeguard price stability through, mainly, monetary policy. When the degree of inflation persistence is unclear, effective policy suggests a strong reaction to deviations from the target in order to limit the risks of inflation continuing to be high for an extended period. The risk of high and persistent prices, together with signals of tightening in the labour market, create an environment which makes it possible for higher inflation expectations and higher prices to become entrenched.
Gent Sejko: Bank of Albania – strengthening governance and recent other challenges Introductory statement by Mr Gent Sejko, Governor of the Bank of Albania, presenting the Annual Report 2015 to the Parliamentary Committee on Economy and Finance, Tirana, 29 March 2016. *  *  *  Honourable Chair of the Parliamentary Committee on Economy and Finance, Honourable Members of the Committee, It is my special pleasure to present, in this hearing session with the Parliamentary Committee on Economy and Finance, the Annual Report of the Bank of Albania for 2015. In 2015, the Bank of Albania has worked to successfully fulfil its objectives stemming from the Law “On the Bank of Albania”, as well as all the other obligations arising from relevant sublegal acts and relations with our international partners. I would like to start my presentation, focusing on the activity of the Supervisory Council of the Bank of Albania. 1. Decisions of the Supervisory Council  At the beginning of 2015, the management team of the Bank of Albania was rendered complete. Thus, thanks to the support of the Assembly of the Republic of Albania, the vacant positions in the Supervisory Council were completed, the Governor, the Second Deputy Governor and Inspector General of the Bank of Albania were appointed. During 2015, the Council met 15 times and approved 98 decisions. Of them, 63 consisted in acts approved for the first time, and 35 in amendments to existing acts.