The situation we found ourselves in over the autumn and winter of 2021-22 was not a looser labour market and an increase in unemployment as the furlough scheme ended. Rather, it was a tighter labour market and a decline in labour market participation. As Chart 6 shows, during this time, supply turned out to be weaker than demand. In other words, as demand increased after Covid restrictions ended, supply did not follow to the same extent. At the same time, a rotation in demand away from services and towards goods, in particular in the United States, continued to put strains on global supply chains. And unfortunately, the contraction in the labour force coincided with the most extreme shock of all during this period, the impact, particularly on energy prices, of Russia’s appalling and unprovoked invasion of Ukraine. So the supply side has played a more important and unusual role in recent macroeconomic developments. Conclusion Now let me conclude with a few remarks on where we stand with monetary policy today. The economy has been subjected to some very large and overlapping shocks. The largest impact has come from the effect of Russia’s invasion of Ukraine. This appalling act had a massive impact on energy prices last year, and has substantially affected other prices, notably food. For a variety of reasons, particularly in energy markets, those effects are now unwinding.
This institution has supported the Romanian banking sector too, especially during the privatization process. Joining MIGA finalized the normalization process. 1/3  BIS - Central bankers' speeches  Throughout the 1990s and up until the EU granted Romania the functional market economy status in 2004, and later on, until the actual EU Accession in 2007, the IMF and the World Bank have been our main economic and financial external partners, during the transition. It goes without saying that one central pillar of this transition was represented by the continuous reforms of the national legislation regarding the central bank and the financial sector reforms, which have benefited from the extensive contributions of IMF and World Bank staff. For instance, the essential legislation governing the banking system was drafted with the assistance of IMF experts. In this context, I would like to mention the seven IMF Stand-by Agreements that, in addition to the Balance of Payments support, have also contributed to the implementation of structural reforms prior to the EU accession. Similarly, the World Bank's programs have contributed to the development of the Romanian financial and banking system (e.g. the Financial and Enterprise Sector Adjustment Loan (FESAL) – focused on reforming the financial sector, and the Private Sector Adjustment Loan (PSAL) – offered support towards the privatization of the Romanian banks and to the development of the monetary and capital market). During this transition period marked by major changes, I would like to highlight one element of continuity.