per cent of gdp by 20291. in major economies, debt - gdp ratios are on an upward trajectory, raising concerns about their sustainability and their negative spillovers for the broader global economy. in several other countries, central banks are willy - nilly expected to facilitate financing of such huge public debts. in fact, the debt overhang is simmering underneath the radar of central banks, threatening to un - anchor inflation expectations and undermine macroeconomic stability. for emerging market economy ( eme ) central banks, the international dimensions of monetary policy continues to be a testing challenge. for them, the trilemma is real. today the global economy is more financially integrated than ever before. monetary policy actions in systemic economies produce large fluctuations in capital flows and exchange rates, which can then feed into domestic liquidity, inflation and eventually affect the real economy. while monetary policies in the systemic economies are determined by their domestic inflation - growth considerations, they have large spillovers to the emerging and developing economies and even to other advanced economies. these spillovers can be expected to accentuate as capital flows dwarf trade flows. quite naturally, emerging economies are having to strengthen their policy frameworks and buffers to manage this external flux and mitigate its adverse consequences. financial stability financial stability is the essential reason why central banks exist. price stability as a central bank objective is of more recent vintage. there is a growing opinion today that 2 / 5 bis - central bankers'speeches'low for long'policies practiced during the gfc and again during the pandemic, apart from providing support to the real economy, also produced exuberant financial asset prices that have come back to haunt central banks in their role as guardians of financial stability. amidst ultra - low interest rates and super abundant liquidity, leveraging and risktaking were celebrated as if there is no tomorrow. consequently, when central banks were confronted with inflation surges in 2022 in the shadow of the war in ukraine, they reacted with one of the most aggressive and synchronised tightening of monetary policies in history. this resulted in risks to financial stability, especially when these risks morphed into banking crises in certain countries in march 2023 and sell - offs in financial markets in august and september 2024. these developments have once again brought to fore the role of central banks in securing and preserving financial stability. specifically, how should they account for financial stability considerations in their pursuit of price stability? let me now address some of the emerging risks to financial

data breaches. additionally, ai's opacity makes it difficult to audit or interpret the algorithms which drive decisions. this could potentially lead to unpredictable consequences in the markets. banks and other financial institutions must put in place adequate risk mitigation measures against all these risks. in the ultimate analysis, banks have to ride on the advantages of ai and bigtech and not allow the latter to ride on them. conclusion 4 / 5 bis - central bankers'speeches despite the difficult trials and trade - offs, central banking in the current decade is a success story. in the realm of monetary policy, central banks have been successful in bringing inflation closer to targets. major financial collapses or recessions, seen during earlier episodes of crisis, have been averted. central banks are now at the forefront of technological innovations and are driving them through sandboxes, innovation hubs and hackathons. as we navigate the high intensity tail events and black swans of the current decade, the lessons imbibed can well form the basis of our deliberations today to chart out a course for the future. central banks must remain vigilant, adaptable, continuously assess risks and build resilience. they should remain prepared to navigate complex challenges, support sustainable growth, maintain price stability and promote sound and vibrant financial systems. thank you. 1 imf fiscal monitor, april 2024. 2 the value of global cross - border payments is estimated to surpass us $ 250 trillion by 2027 ( cross - border payments | bank of england ) 3 the global cross - border b2c e - commerce market which was valued at us $ 889 billion in 2022 is estimated to grow by more than six times to us $ 5. 6 trillion in revenue by 2030 ( cross - border b2c e - commerce market size report, 2030 ) 4 these include project nexus, a multilateral international initiative to enable instant cross - border retail payments by interlinking domestic instant payment systems ( ipss ) of four asean countries ( malaysia, philippines, singapore, and thailand ) and india. under bilateral arrangements, cross - border payment linkages have already been established by india with singapore, uae, mauritius, sri lanka, nepal, etc. 5 / 5 bis - central bankers'speeches