The future of monetary policy : Summary of the conference held in Rome on 30 September and 1 October 2010

What lessons can be learnt from the financial and economic crisis for the strategy and conduct of monetary policy? To analyse and debate this topic, more than eighty participants, chiefl y from Europe and the United States, mostly professors of economics at prestigious universities or central bank economists, came together in Rome on 30 September and 1 October 2010. This conference was the fruit of collaboration between the Banque de France, the Banca d’Italia and its research institute, the Einaudi Institute for Economics and Finance. It provided a forum for the presentation of a number of studies about the various aspects of this question, including the role of central banks in maintaining the smooth functioning of the interbank market, the effectiveness of the non-standard monetary policy measures adopted during the crisis, the interaction between monetary policy and macroprudential policy, and the role of macroeconomic stabilisation policies during periods of “excessive” credit expansion.[br/][br/]The conference lasted two days and included two presentations by prominent academics, the fi rst by Professor Michael Woodford from Columbia University in New York and the second by Professor Markus Brunnermeier from Princeton University in New Jersey. A number of research papers were presented by their authors and discussed by two selected experts before an open debate with the audience. The conference closed with a round table debate between Mario Draghi (Governor of the Banca d’Italia), Charles Evans (President of the Federal Reserve Bank of Chicago), Christian Noyer (Governor of the Banque de France) and Athanasios Orphanides (Governor of the Central Bank of Cyprus) on “The future of monetary policy”.[br/][br/]This article summarises the main questions that dominated the presentations, discussions and debates, namely: are monetary policy and liquidity management always independent from each other? Should monetary policy preserve fi nancial stability? Should monetary policy react to asset price bubbles? And, more generally, what is the future for monetary policy?