•  Second, the central banks in developed economies are increasingly focused on more subtle analyses of the financial system stability in their countries, and inevitably, as a result and consequence of the globalization, in wider terms. It requires access to various information. We also face this imperative, if seeking to successfully address the potential financial market vulnerabilities and crises. Thus, the role of the financial sector in the economy and its interdependence with all other sectors created a need of establishment of a proper financial account statistics. Statistics that shows the flow of the financial assets across each sector in the economy. The successful delivery of this project needs joint work and cooperation between the National Bank and the State Statistical Office. I believe that the team of Ms. Novkovska and the experts of the National Bank will deliver this project successfully. Without this type of statistics, our financial stability analyses will lie on less certain ground. •  Third, there is a higher need of statistical treatment of the funds with the household sector. The steady increase in the funds of the household is an important trend which is present in the modern economy, and lately in our country, mainly owing to the fact that they have better access to banking credits. Considering the importance of this sector in the economy, there is a need of increasing the range of statistical information that refer to the household sector with a view to more relevant determining and analyzing of their current and future behavior.
While the underlying core inflation rate, that strips out volatile food and energy prices, has been somewhat higher than expected a few months back, it appears that the annual rate of core inflation2 has peaked and we expect it to begin to decline later this year.3 Finally, inflation expectations, which play an important role in the inflation process, remain well anchored. By this I mean that people expect that the rate of inflation will continue to be relatively low for some time to come. Regional economic conditions So how is the recovery proceeding in the state and the region? As I mentioned, the New York Fed produces indexes that help us track economic activity in the region. Based on these measures, the economic recovery got underway in both New York State and New York City in late 2009, and economic activity has continued to expand through early 2012. The New York Fed also conducts the monthly Empire State Manufacturing Survey to monitor conditions for regional manufacturers. The most recent survey, for which a number of Long Island firms participated, points to continued expansion in manufacturing activity throughout the first quarter of 2012 and heightened optimism about the general business outlook. Recently released employment revisions indicate that the economic recovery has taken hold on Long Island. But there still is a long way to go. Employment on the island declined by a little over 4 percent in the downturn – a steep drop, to be sure, but only about two-thirds of the decline that occurred nationally.