On the other hand, I find it difficult to  * Thanks to Björn Lagerwall who has helped me prepare the speech and to Anna Österberg who has helped in  producing data and figures. Thanks also to Charlotta Edler, Henrik Erikson, Jesper Hansson, Jens Iversen, Marianne Nessén, Amanda Nordström, Tommy Persson, Ulf Stejmar, Marianne Sterner, Anders Vredin and Magnus Åhl for valuable comments. 1 [30]  see the value of later increasing and prolonging the asset purchase programme in a situation where the economy was recovering rapidly and the financial markets were functioning again.   Asset purchases need to be weighed against the risks and problems they can entail. One risk, which has now begun to materialise, is that the purchases entail substantial financial losses. This may, for example, jeopardise the Riksbank's financial independence and thereby impair the conditions for conducting monetary policy in the long run. Another risk is that market participants start to expect the Riksbank to step in as buyer when there is stress on the markets. Why should a central bank purchase assets? During and after the global financial crisis, central banks have needed to manage financial markets that have periodically functioned very poorly. Moreover, their policy rates have at times been limited by a lower bound. It has therefore not been possible to cut the policy rate as much as would have been needed. To manage the problems, many central banks have over the past 15 years launched extensive programmes for asset purchases.

With considerable capacity to meet large investment requirements, opportunities therein lie in the more effective and efficient channelling of the  2  BIS central bankers’ speeches  sizeable surplus funds towards the vast productive investment opportunities within and across the emerging economies. These trends are being reinforced by the rapid expansion of financial institutions in emerging economies that have ventured beyond national borders. Financial institutions from the emerging economies have grown significantly in size and strength in this recent decade to now account for almost half of worldwide financial industry market value. Eight out of the twenty largest global banks, including the top two, are emerging market financial institutions. As the emerging market financial institutions continue to regionalise and internationalise, their role and importance can be expected to further expand. Another key development is the integration of financial markets amongst emerging economies, driven in part by the increased economic inter-linkages and the increased liberalisation trend in the financial sector. The rapid internationalisation of Islamic finance is reinforcing this trend and has enhanced the economic and financial connectivity between the emerging economies. The high level of savings and wealth accumulation in several of the emerging economies, including in Asia and the Middle East, need to be effectively channelled towards productive investments including for large infrastructure development. In this environment, Islamic finance has emerged as a viable and attractive form of intermediation including financing of large scale infrastructure projects.