##ilient and grow above trend ( govt target of 7 – 8 pct ), in a low inflation environment ( govt target of 2 – 4 pct ), supported by a sound banking system, and able to withstand reasonable external shocks. i also hope that you now have a better appreciation of what to expect from the bsp. the bsp can lead in the initiatives i mentioned, but we cannot do it alone. you, in the corporate world, are the ones who bring to life the policies we espouse. as you can see from the slide, the goal is to have everyone rowing in synch and towards the same goal. in the areas under our purview, the bsp has tried to be an innovative leader. 1. we try to be unconstrained by the past, even as we learn from it 2. we always ask the relevant questions and try to find the appropriate answers, and 3. we continue to believe that, in partnership with the market and corporate world, there is always a better way of doing things. as we push forward in 2015, i hope that the map and the bsp can work more closely together towards our shared goal of a stable macroeconomy and sustained economic growth. thank you and again, good afternoon to everyone. bis central bankers ’ speeches

weakness spread to the rest of the globe. there also was no clear way out of the room for the debt crisis in europe. market confidence ( and in some jurisdictions, even political confidence ) was very low, if not non - existent. during the gfc, major central banks had reached the zero bound of the policy curve. interest rates had gone so low, there was hardly any wiggle room to use interest rates for stimulating the economy. we could therefore no longer rely on the familiar channels of transmission of monetary policy. at the time, new transmission channels emerged such as the “ expectations channel ” and the “ risk - taking channel ”. so, advanced economy central banks needed to employ non - conventional monetary tools. even central banks in some emerging market economies had to deploy non - traditional tools because of contagion. as a result – asset purchase programs in all letters of the alphabet some of which you would normally throw away in a game of scrabble came into vogue. q - e - 1, qe2 ( with operation twist ) in the us, omt [ or outright monetary transactions ] and tltro [ or targetted longterm refinancing operations ] in europe, and q - q - e ( quantitative and qualitative easing – the three arrows ) in japan. bis central bankers ’ speeches furthermore, central banks needed to be sharper and more pointed in their communication of policy intent. as you now know, “ forward guidance ” has come to be a specific central bank technique for managing market expectations. in addition, financial stability and the systemic nature of risks became the driving forces for the global financial reform agenda. “ too big to fail ” was no longer going to be the bottom line. even as we speak, ladies and gentlemen, financial reforms are being put in place so that those defined to be “ systemically important institutions ” would not have to be bailed out by taxpayer money. these sifis would instead be mandated to meet a higher capital standard. sifis have to have more “ skin in the game ”, so to speak. and the game, ladies and gentlemen, has changed. micro prudential regulations, while necessary, are no longer sufficient. it may be recalled that micro prudential measures are meant to improve individual institutions ’ resilience to risks. central banks must now also have macroprudential measures in place. macroprudential measures look to address the interconnected nature of the system and