New Challenges for Monetary Policy A Symposium Sponsored by the Federal Reserve Bank of Kansas City, Jackson Hole, Wyoming, August 26-28, 1999

After two decades of successfully restoring price stability in much of the world economy, central banks begin the next millennium facing a new set of challenges. One key task is how to conduct monetary policy in an era of price stability. Clearly, policy-makers would like inflation to remain subdued. But, how should monetary policy procedures be designed to ensure that inflation does not reappear as a serious policy problem? Another important question is whether central banks enjoy greater operational flexibility or face new constraints in an environment of low inflation. On the one hand, operating in a low-inflation environment may give central banks greater leeway to address short-run economic problems without compromising long-run price stability. On the other hand, monetary policy implementation may become more difficult as nominal interest rates approach zero. Recent crises in financial markets around the world pose an additional set of challenges for policy-makers. Indeed, preserving global financial stability and dealing with extreme asset price and exchange rate movements have taken on greater urgency in many recent policy discussions.Greenspan, Alan is the author of 'New Challenges for Monetary Policy A Symposium Sponsored by the Federal Reserve Bank of Kansas City, Jackson Hole, Wyoming, August 26-28, 1999' with ISBN 9780894991226 and ISBN 0894991221.