3 1 / trend component extracted by hodrick - prescott filter. * / first quarter. source : own calculations with data from haver analytics. graph 2 the united states and germany : interest rate spreads1 basis points 3 - month 5 - year 10 - year - 40 june 2 - 80 jan - 16 apr - 16 oct - 15 jul - 15 jan - 15 apr - 15 jul - 14 oct - 14 jan - 14 apr - 14 oct - 13 jul - 13 apr - 13 jan - 13 jul - 12 oct - 12 jan - 12 apr - 12 jul - 11 oct - 11 apr - 11 jan - 11 jul - 10 oct - 10 apr - 10 jan - 10 - 120 1 / u. s. treasuries minus german bunds. source : bloomberg. bis central bankers ’ speeches graph 3 the united states : volatility in the options market ( vix ) 1 % june 3 may - 16 jan - 16 sep - 15 may - 15 jan - 15 sep - 14 may - 14 jan - 14 sep - 13 may - 13 jan - 13 sep - 12 may - 12 jan - 12 sep - 11 may - 11 jan - 11 sep - 10 may - 10 jan - 10 1 volatility implied by s & p 500 index over the next 30 days, calculated by taking a weighted average of the implied volatility of eight call and put options. source : bloomberg. graph 4 net portfolio capital flows to emerging economies1 billions of dollars - 40 q1 q2 q3 q4 q1 q2 q3 q4 q1 q2 q3 q4 q1 q2 q3 q4 q1 q2 q3 q4 q1 q2 q3 q4 q1 q2 * 1 / net purchases by non - residents of stocks and bonds in emerging economies. emerging economies are argentina, brazil, chile, china, colombia, the czech republic, egypt, hungary, india, indonesia, south korea, lebanon, malaysia, mexico, nigeria, the philippines, poland, russia, saudi arabia, south africa, thailand, turkey, ukraine, the united arab emirates, and venezuela. * / includes estimates for april and may. source : iif. bis central bankers ’ speeches graph 5 emerging economies and the united states : 10 - year interest rate % emerging economies1 june 2 united states jan - 16 apr - 16 oct - 15 jul - 15 jan - 15 apr - 15 jul - 14 oct - 14 jan - 14 apr -

manuel sanchez : the effects of monetary divergence remarks by mr manuel sanchez, deputy governor of the bank of mexico, at the symposium jornadas economicas, organized by the banco de guatemala, guatemala city, 7 june 2016. * * * accompanying graphs can be found at the end of the speech. i would like to thank the bank of guatemala for the invitation to participate in this symposium, now in its 25th year, which has become an invaluable forum for discussing substantive economic issues in latin america. on this occasion, i will devote my comments to the divergence of monetary policy stances in advanced nations and the potential impact this may have on emerging economies. as usual, my remarks are entirely my own and do not necessarily reflect the views of the bank of mexico or its governing board. monetary policy divergence central banks guide their actions according to the developments and outlook of their own economies. most of them hold as a primary objective a low inflation rate, commonly two or three percent in annual terms, but they also take into account economic growth, either as an explicit objective or as an essential piece of information for pursuing price stability. at any moment, economies could find themselves in different cyclical stages and confronted with particular challenges. thus, it should not be surprising that monetary policies among nations do not coincide. not only can monetary stances vary internationally, being tighter or looser than their neutral references could be, but also, these differences can widen over time. one example of discrepancy occurred in the 1990s between the united states, which began to tighten policy in a context of economic growth, and germany, which started to do the opposite in the face of higher unemployment stemming from political unification. notwithstanding such particular cases, there does seem to exist a certain tendency in the medium term toward the international synchronization of economic cycles, especially among high - income countries. additionally, in recent decades inflation rates have been persistently declining in advanced as well as non - advanced economies. consequently, a propensity towards convergence among monetary policies has become evident, particularly among developed nations. see graph 1 in a world in which economic and financial integration has become tighter, it is difficult to conceive of domestic monetary policies as completely isolated, including those of large economies. by way of illustration, the u. s federal reserve has repeatedly stated that it will continue to consider global economic and financial developments in its decision - making process. the aforementioned output and monetary synchronizations are