Quarterly Bulletin

Subscription orders for Quarterly Bulletins and Annual report and requests for specimen copies should be sent to: Kluwer Academic Publishers po Box 17 — 3300 ah Dordrecht — The Netherlands Edition: 1.100 Publication and multiplication for educational and non-commercial purposes is allowed, with acknowledgement. This publication contains a translation of the Dutch-language Quarterly Bulletin of De Nederlandsche Bank nv, except where indicated otherwise. In the event of discrepancies between the original Dutch-language version and this translation, the Dutch text shall prevail. issn: 0922-6184 Recent developments Monetary and economic developments The Netherlands in the euro area 7 Euro sentiment turns corner 14 Supervision Latest developments in supervision 19 Payments Current developments in payments and securities transactions 23 Banking industry on schedule with euro introduction 30 Articles Economic convergence and monetary policy in accession countries 37 Towards a new Basel Capital Accord 47 A comparative study of the Federal Reserve System and the escb as monetary policy institutions 55 A new approach to risk in foreign exchange settlement 65 The role of fiscal policy in emu: A simulation with euromon 73 Publications dnb Staff reports 89 Monetary Monographs 91 Contents Recent developments Owing in part to adjustments in consumption-related and indirect taxes, inflation in the Netherlands for January 2001 was the highest in the euro area. After a strong fourth quarter, the Dutch economy could look back on a good cyclical year; yet preliminary estimations indicate that growth levels may flatten out to 3% in 2001. The Bank's GDP indicator also points to a cyclical deceleration to 2.7% growth on average during the first three quarters of the present year. As a result of the robust economic growth of recent years, unemployment appears to be mostly friction-al. Employment growth is increasingly drawn from among broader echelons of previously inactive persons, causing the participation rate to rise. In view both of the Lisbon objectives (to be evaluated at the upcoming European Council meeting in Stockholm) and of the continuation of a satisfactory growth potential in the Dutch economy, prolonga-tion of this trend is essential. Inflation The measure relevant to the Eurosystem's European monetary policy is the harmonised consumer price index or hicp. As expected, hicp inflation shot up from 2.9% in December 2000 to 4.5% in January 2001. 1 This inflation jump gave the Netherlands the highest current inflation figure in the euro area (Table 1). The rise stems primarily from the new …