Monetary Policy and the Business of Central Banking - SUERF Annual Lecture 2024 - Martin Hellwig

On 4 November 2024, over 200 international experts gathered in Vienna and online to discuss the topic ”Monetary Policy and the Business of Central Banking “.

Behind their role as policy makers, central banks are also businesses with many operational tasks which the public is little aware of. They finance the various services which they provide to the public out of “seigniorage” income (the income generated from issuing central bank money), which is influenced by the composition and the properties (risk, return) of the assets and liabilities in their balance sheets. The SUERF Annual Lecture started from current discussions about the losses incurred by central banks and ask whether there is a conflict between the policy mandate of the central bank and the viability of the central bank as a business, which is essential to its independence. Sources of losses, such as the risk on assets held and the interest paid on reserves, were considered, as was the relation of these phenomena to monetary policy and to the central bank’s mandate. In a longer perspective, central banks’ “business model” as such may need reconsideration as seigniorage may be disappearing in a digitalized world, requiring central banks to find new sources to finance their important functions and services for societies.

The 2024 SUERF Annual Lecture highlighted topical perspectives relevant in this context from one of Europe’s leading academic researchers in the field. Moderated by SUERF’s Secretary General, two senior policy makers added their perspectives. The Governor of the Austrian Central Bank opened the event.

Speakers and timeline

00:00:14 – Opening and introduction: Governor Prof Robert Holzmann, Oesterreichische Nationalbank (OeNB)
00:08:04 - SUERF Annual Lecture 2024 “Monetary Policy and the Business of Central Banking“ by Prof Martin Hellwig, Director (em.), Max Planck Institute for Research on Collective Goods
00:46:36 - Q&A
00:52:03 - Panel discussion, moderated by Prof Ernest Gnan, Secretary General, SUERF
00:52:17 - Comments by Sarah Bell, Head of Central Banking Studies, Bank for International Settlements (BIS)
01:08:52 - Comments by Stefan Ingves, Senior Fellow, Swedish House of Finance | former Governor, Sveriges Riksbank
01:22:10 – Panel discussion and Q&A
01:51:30 - Closing and farewell

© SUERF 2024. Views expressed are those of the speakers only and not necessarily of their affiliated institutions.