In contrast, under present arrangements, how long that period lasts will depend on macroeconomic conditions. The inflation target dictates that we should continue to buy gilts (or other assets), including reinvesting maturing gilts, so long as inflation is more likely than not to undershoot the inflation target in the medium term. And it also dictates that we should sell them when inflation is more likely than not to overshoot the target. Making gilt sales/purchases contingent on the economic environment must surely be the right way to set policy. 5 My first seven years at the Bank coincided with one of the most tranquil periods in British macroeconomic history. The past five years since the eruption of the global financial crisis have been anything but. It has been a challenging but humbling experience. We knew less than we thought. And we forgot some of the lessons of history. As a result of the crisis, we have found ourselves providing liquidity support in unexpected ways, deploying unconventional monetary policies in alien circumstances, and developing a whole new lexicon of macroprudential policies. Although it will be some time before the post-crisis adjustment is complete, normality will eventually return. Hopefully we will then be in a position to leave our successors both wiser and with a better toolkit to deal with similar challenges in the future. Thank you for your time.
On several occasions, the Eurosystem has voiced its expectations regarding SEPA for cards. In particular, the card schemes should offer consumer choice, operate in competitive markets  2  “The economic impact of the Single Euro Payments Area”, by Heiko Schmiedel, ECB Occasional Paper No 71, August 2007. 3  Payment and securities settlement systems in the European Union, Blue Book, fourth edition. 4  “The Costs of Paying – Private and Social Costs of Cash and Card Payments”, Mats Bergman, Gabriela Guibourg and Björn Segendorf, Working Paper No 212, Sveriges Riksbank (September 2007). BIS Review 134/2007  3  and avoid geographical segmentation. In doing so, the Eurosystem expects that the SEPA for cards offers high efficiency and low prices derived from current best practices. In my view, a clear long term strategy of a SEPA for cards is not yet developed. The Eurosystem expects at least one new European card scheme which can compete with the international schemes in the SEPA environment. I’ll address this issue more in depth in the following panel. What I would like to stress, however, is that the Eurosystem welcomes the progress that has been made towards standardisation for cards, which, when implemented, will lead to the creation of a European market for terminals and for cards acquiring. The Eurosystem also welcomes the efforts of the international card schemes in preparing for SEPA and the SEPA changes they have already announced.