More evidently in recent times, cases of market manipulation and illegal fixing of interest rate and foreign exchange benchmarks have surfaced globally. These cases were only possible because of collusion and have collectively undermined the trust, integrity and confidence in the global financial market. The consequences are dire. As the saying goes, ‘trust takes years to build, seconds to break, and forever to repair’. One significant example of such far-reaching incidents that undermined trust, was the manipulation of the LIBOR benchmark, a benchmark rate used to price a market estimated at USD450 trillion. Ineffective due diligence in the case of a rogue trader of a French bank and the ‘London Whale’ incident has also tarnished the credibility of some international institutions. Closer to home, two Australian banks were charged for manipulating the NDF ringgit fixing rate in Singapore. For the Malaysian market, we have recently introduced the Principles for a Fair and Effective Financial Market (Principles) on 13 April 2017 as part of our market development strategy to uphold and maintain the trust, integrity and confidence. These principles represent the universal overarching ideals for a fair and effective financial market. It complements the rules-based guidelines and regulations, including the recently revised Code of Conduct. I wish to highlight these principles; 1. Professionalism and integrity, through universal adoption of best market practices; 2. Full transparency and accountability, in all aspects of market participation; 4/6  BIS central bankers' speeches  3. A competitive environment that is free from collusive, fraudulent and manipulative activities; 4.

And in some cases there is also a willingness among central banks themselves to adopt a looser interpretation of their existing mandates. This tendency has strengthened noticeably of late. In our case, for example, there have been a series of motions in parliament calling on the SNB to do more with regard to climate protection. The same applies to the issue of inequality, ever since the use of central bank balance sheets to tackle the global financial crisis has increasingly raised questions regarding the redistribution of wealth. Time and again, there have been initiatives from politicians demanding that central banks directly finance government tasks. For example, a popular initiative was recently launched in Switzerland seeking to amend the Federal Constitution to give the SNB a direct role in financing the national pension scheme. How is the SNB to deal with these demands? All these concerns – from climate protection to the redistribution of wealth and securing pension provision – are important matters that are Page 9/16  rightfully being raised. That said, I am convinced that attempting to solve these issues with monetary policy instruments would entail a significant threat to the effectiveness of monetary policy over the medium to long term. The SNB naturally has to take into account the influence that changes in the economic structure have on inflation. For example, climate change can have an effect on potential growth, and this has to be considered when setting the monetary policy stance. However, the mandate of a central bank must not be overburdened.