further reduce the amount of duration risk that is borne by investors, contributing to a compression of term premia. as of the end of 2019, the net asset purchases and reinvestment policy had already led to the withdrawal of substantial duration risk from the market, in the order of 19 percent of the duration - equivalent stock of outstanding public debt in the four largest euro area economies. this is foreseen to increase to 27 percent by the end of the second quarter of 2021, taking into account the june policy decisions and the expected supply of bonds entailed in the eurosystem staff macroeconomic projections ( chart 6 ). chart 6 outstanding quantity of duration : holdings of eurosystem ( pspp and pepp ) and other investors https : / / www. ecb. europa. eu / press / key / date / 2020 / html / ecb. sp200624 ~ d102335222. en. html 5 / 13 7 / 15 / 2020 the ecb ’ s monetary policy response to the pandemic : liquidity, stabilisation and supporting the recovery ( left panel : eur billions ten - year equivalents ; right panel : percentages ) sources : securities holdings statistics, government finance statistics, ecb and ecb calculations. notes : the chart shows the stock of debt securities issued by each general government of the four largest euro area jurisdictions, and the amounts of that stock held by the eurosystem ( under the pspp and pepp ) and other investors in terms of ten - year equivalents. “ other investors ” comprise all other financial and non - financial investors. solid columns ( lines ) denote historical data and patterned columns ( dotted lines ) denote forecasts. the latest observations are for 2020q1 ( historical data ) and 2021q2 ( projected data ). the pepp and the scaling - up of the asset purchase programme are estimated to reduce the ten - year sovereign term premium by almost 45 basis points ( chart 7 ). this adds to the nearly 100 basis point compression in the term premium that is attributable to the sizeable stock of assets purchased under the app in recent years and the september 2019 recalibration of the app. these are likely to be conservative estimates of the impact of the march and june 2020 asset purchase decisions on euro area sovereign yields, since these estimates are based on elasticities of yields to asset purchases estimated from the public sector purchase programme ( pspp ). in fact, event

roots in 16th century spain. rising inflation and the dependency on gold and silver imports are mentioned as causes of multiple bankruptcies and economic crashes. 6 following the agenda set by the 16th century globalisation episode, my speech is divided into two main parts. the first part deals with the effects of globalisation on inflation dynamics and price stability from a monetary policy perspective. i will elaborate on the likely impact on product and labour markets as well as the impact on monetary aggregates and financial markets. in the second part, i will reflect on the link between globalisation and financial stability again focusing on the role of central banks. in this context, i will point to the risks associated with global imbalances and asset price boom - and - bust cycles. i will conclude by addressing two pertinent questions, namely ( i ) whether central banks need to adapt their monetary policy strategies in order to cope with the challenges of globalisation ; and ( ii ) whether monetary policy has become less effective as a consequence of globalisation. in 1778, catalonia was allowed to trade with the americas by decree of charles iii. adam smith estimated that “ the discovery of the abundant mines of america reduced, in the sixteenth century, the value of gold and silver in europe to about a third of what it had been before. ” see smith, 1776. hamilton, 1934. bernholz and kugler, 2007. navarro, one of the most famous scholars of the school of salamanca wrote in 1566 that “ other things being equal, in countries where there is a great scarcity of money, all other saleable goods, and even the hands and labour of men, are given for less money than where it is abundant. ” see, for example, munro, 1994. as i have already mentioned the term globalisation a number of times, and many more references will follow, let me briefly define it in fairly broad terms : it is the process of rapidly increasing global economic integration. over the past decade, this process involved, and is evidenced by, the unprecedented and pervasive growth in the cross - border trade of goods and services as well as of financial and real assets, but it also involves the swift transfer of technologies, information and ideas. ii. globalisation, price stability and monetary policy ii. 1. impact of globalisation on product and labour markets let me start by briefly reviewing both the theoretical arguments and the empirical evidence pertaining to the effects of globalisation on product and labour markets. it would be too easy