Nobel Laureate in economics Professor Joseph E. Stiglitz today paid a visit to the Magyar Nemzeti Bank, where he met with György Matolcsy, Governor. At the meeting, the Governor and Professor Stiglitz discussed international economic and financial developments as well as topical issues relating to monetary policy. After the discussion, Professor Stiglitz of Columbia University gave a well-attended lecture to MNB staff in the Bank’s main office.

In his speech ‘Monetary Policy in the Wake of the GFC’, Professor Stiglitz set out his views on such issues as the lessons to be learned from the global financial crisis, the role and independence of central banks as well as their old and new mandates, the various micro and macroprudential instruments available for use by central banks, and the importance of regulation.

Professor Stiglitz emphasised that, faced with new challenges, central banks have responded to the crisis by expanding their mandates and the range of their instruments. In addition to reinforcing their original mandate to maintain price stability, central banks will need to have a reformed institutional framework in place to ensure the safeguarding of financial stability. Professor Stiglitz added that a stronger regulatory environment is required, as cross-border financial activities are leading to increased risks.