Training Day is the first day of each ECB Simulation Conference for university students, where distinguished representatives of institutions, the market and academia share their knowledge and experiences with the conference participants.
The Training Day of the 7th ECB Simulation Conference was held at the Amphitheater of the Karatza Megaron of the National Bank of Greece on the 15th of December 2023 (the remaining days, 16-18 of December, were held at the Troias Building of the Athens University of Economics and Business). The examined topics of the Conference were:
- Interaction of Monetary and Fiscal Policy.
- Inflation: causes and tools for tackling it.
- Monetary Policy: Its response and efficiency in a Perma-Crisis environment.
- ESG transformation in the financial sector and its challenges.
- Challenges of adopting a Digital Euro solution.
Here we present the remarks of the speakers who participated in the Keynote Speeches, where we were honored to have Ms. Ifigeneia Skotida, Deputy Director of the Economic Analysis and Research Department at the Bank of Greece, Mr. Gabriel Glöckler, Principal Adviser at the Directorate General Communications at the European Central Bank and Mr. Christos Gortsos, Professor of Public Economic Law and Academic Head of the LLM Program in “Financial Regulation” at the Law School of the National and Kapodistrian University of Athens.
The keynote speeches started with Ms. Ifigeneia Skotida, Deputy Director of the Economic Analysis and Research Department at the Bank of Greece.
In her speech, Ms. Skotida addressed the progress of inflation in the Euro Area, stressing the substantial rise in inflation rates due to various factors such as supply chain disruptions, pandemic-induced demand surges, and geopolitical tensions, notably the war in Ukraine. Ms. Skotida outlined the Eurosystem’s response to manage and stabilize price stability, discussing the gradual tightening of monetary policy through measures such as ending asset purchase programmes, adjusting interest rates, and implementing policies to protect the transmission mechanism. Afterward, she discussed future policy considerations, acknowledging the challenges posed by ongoing uncertainty, geopolitical risks, and economic fragility, highlighting the importance of a cautious, flexible, and data-driven approach, and communicating with clarity to steer market expectations while aiming to achieve price stability. Closing her remarks, Ms. Skotida referred to the environment of high inflation and the Eurosystem’s response, which involved a strategic balance between addressing inflationary pressures while minimizing the risk of a recession.
Mr. Gabriel Glöckler, Principal Adviser at the Directorate General Communications at the European Central Bank, delivered the second keynote speech, emphasizing the critical role of communication for Central Banks in fulfilling their mandate. More specifically, he stressed the importance of clear and understandable communication in maintaining public trust in Central Banks. Mr. Glöckler pointed out that studies have revealed a lack of awareness among the market participants regarding the workings of the European Central Bank (ECB).
Continuing his speech, he emphasized that trust is built over time through credible and consistent communication between the ECB and the public. This trust can be strengthened by fostering a broader understanding of the ECB’s mandate, ultimately aiding the achievement of its objectives and goals. Moreover, he underlined the ECB’s efforts to improve public communication by enhancing transparency in its decision-making and operations.
However, Mr. Glöckler suggested that Central Banks should give even greater emphasis on their communication with the public, utilizing other communication channels that are more accessible, such as social media, TV, and radio. He also highlighted the importance of tracking the effectiveness of the ECB’s communication strategy and adjusting it as needed. Closing his remarks, Mr. Glöckler stressed that in an increasingly complex world, Central Banks must serve as a trusted source of information and guidance.
The keynote speeches concluded with Mr. Christos Gortsos, Professor of Public Economic Law and Academic Head of the LLM Program in “Financial Regulation” at the Law School of the National and Kapodistrian University of Athens, who provided an overview of the topics examined at the 7th ECB Simulation Conference.
He commenced his address by emphasizing that the debate on the digital euro is no longer conducted at an abstract level but within a certain legal framework, that is being developed by the European Commission. More specifically, he noted that the digital euro will be issued either by the ECB or national central banks, coexisting alongside banknotes, will be accessible to all, and universally accepted as a means of payment. However, he recognized that the implementation of the digital euro poses risks in terms of a) financial stability, b) price stability, c) money laundering, and d) data protection.
As far as the ESG topic is concerned, Mr. Gortsos highlighted that many problems arise from non-compliance with regulations and that from 2025 onwards it will be mandatory for banking institutions to adopt risk management systems for ESG parameters. Furthermore, he emphasized that the ECB can influence demand in the market by setting interest rates, but not supply, and highlighted that often the monetary policy pursued by the ECB and the fiscal policy pursued by national governments in the eurozone are in conflict, which prevents the desired results from occurring. Concluding his remarks, Mr. Gortsos pointed out that the tools available to the ECB have to be adapted and revised to be able to deal effectively with the “Perma-Crisis” conditions and need to be reviewed.