“Market participants’ renewed sense of optimism has accompanied further policy accommodation, but macroeconomic performance is lagging behind.
In the third quarter of 2012, BIS reporting banks posted their smallest increase in cross-border claims in 13 years. They increased their crossborder claims on non-banks located in the United States but cut their exposure to banks in the euro area.
Inflation expectations returned to pre-crisis levels as central banks started to implement asset purchase programmes in late 2008 and early 2009. But further analysis suggests that these programmes were probably not the main driver of these shifts.
Measures of financial conditions can improve our ability to explain movements in output, but they provide only limited information about future inflation.
FX derivatives transactions by Chilean pension funds reduced stress in local FX markets during the global crisis.”
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