And even as they impact the economy, the appropriate policy response may not be obvious because it may be difficult to assess in real time the probable duration of the shock and whether it is demand driven or supply driven. Even at a one-year horizon, which for policy purposes is not a very long time, there is considerable uncertainty surrounding forecasts of GDP growth. For example, the Survey of Professional Forecasters reports that on average 50 economists attach a 90 percent probability to an outcome for real GDP growth for 2007 that ranges from 1.0 percent to 5.0 percent. The width of this band of confidence or uncertainty is similar to that in the published forecasts of many central banks. The types of fundamental uncertainty I just reviewed are always present, but their impact on the appropriate near-term trajectory of rates, and hence on the degree of confidence the central bank can convey about that trajectory, may vary substantially over time. I want to mention a few other concrete examples of the uncertainty we currently face. The latest wave of global economic integration has influenced inflation and output dynamics around the world in ways that may be hard to understand fully in real time. Technological progress, along with the transition to greater labor force participation in emerging and developing economies has probably served to keep inflation low in many other countries and has served to increase the rate of growth in potential output globally.
The “non-cash” euro is already in use The final stage of the introduction of the euro will include two changeovers: the changeover to the noncash euro, which concerns all book-entry transactions (cheques, bank accounts, bank card payments, transfers, loans, etc.) and the changeover to the cash euro, which concerns banknotes and coins. This summer, banks in France started to systematically convert bank accounts into euros and provide customers with euro cheque books. In various participating countries, in particular France, all bank accounts have already been converted . It is now up to each citizen in the euro area to establish a new scale of values for the currency and to make payments in euro. In this respect, retailers have a fundamental role to play: their active participation and their readiness to accept payments in euro will greatly facilitate the euro changeover as a whole. The cash euro will be in circulation within 8 weeks As regards the cash euro, the main task now consists in frontloading the banknotes and coins so that, on 1 January 2002, transactions can be carried out smoothly in the best possible security conditions. To achieve this, frontloaded coins are supplied to credit institutions. Banknotes will soon be provided to them (as of 1 December in France). Retailers will also be provided with frontloaded banknotes and coins.