Financial Stability in a Weak Global Environment

Even almost eight years since resorting to the extraordinary monetary and fiscal measures to counter the after-effects of the Global Financial Crisis, authorities are still left wondering about relationships between key parameters such as unemployment and inflation, as some of the time-tested tool kits have discernibly failed. The recent speeches by FED Chair and her colleagues are a testimony. Against this backdrop, it is important to remain mindful of the uncertainties, stay as vigilant and as prepared with ex-ante institutional framework, policy measures and decisions as one can be, to tide against the possible forces of destabilisation [Address delivered at the 7th SEACEN High Level Seminar for Deputy Governors in–charge of Financial Stability and Supervision held in Mumbai].