Joachim Nagel: Is monetary policy still regulatory policy today?

Speech by Dr Joachim Nagel, President of the Deutsche Bundesbank, at the University of Lucerne, Reichmuth & Co Lecture No 19, Lucerne, 23 September 2022.

Central bank speech  | 
26 September 2022

1 Introduction

Dear Thomas Jordan,
Dear Professor Schaltegger,
Ladies and gentlemen,

Thank you very much for inviting me to this distinguished series of events.

You are in an enviable position here in Switzerland! Not just because of the glorious scenery here at Lake Lucerne, but also because of the country's inflation rate, which is admittedly also too high, at 3.5% in August. I would be happy, though, if we had that rate in the euro area right now, instead of 9.1%.

Yet my counterpart Thomas Jordan and I won't be focusing, like we often do, on economic activity and price developments today. I am pleased to be speaking on a subject that is of a fundamental nature but is nonetheless topical and of practical relevance at the same time.

2 Understanding regulatory policy

Is monetary policy still regulatory policy today? That is a question that is almost impossible to answer without delving first into what regulatory policy means and how it originated. But I will keep the backstory brief, I promise.