mark carney : canada ’ s new polymer bank notes – celebrating canada ’ s achievements at the frontiers of innovation remarks by mr mark carney, governor of the bank of canada, at the presentation of new polymer bank notes, bank of canada, ottawa, ontario, 20 june 2011. * * * i am very proud to represent the bank at this historic unveiling of a new generation of bank notes. secure, durable and innovative, these new notes are at the frontier of bank note technology. they will set a benchmark worldwide and will help maintain the confidence canadians already have in their currency. designing and issuing bank notes that you can trust is an important element of the bank ’ s mandate to promote the economic and financial welfare of our country. this new series of bank notes combines innovative technology and canadian ingenuity. they were developed by a team of physicists, chemists, engineers and other experts from the bank of canada and from across the bank note industry. this work was borne out of necessity. beginning in 2001, counterfeiting in canada increased dramatically, to levels that were very high by canadian and international standards. by 2004, counterfeiting was at a historic peak of 470 counterfeit notes detected per one million notes in circulation. the bank responded with an aggressive strategy to deter counterfeiting, which included training retailers to recognize genuine notes, working with law enforcement to catch and prosecute criminals, and improving the quality of those notes in circulation. we succeeded. today there are only 35 counterfeit notes detected per million notes – a more than ten - fold reduction. of course, even one counterfeit note is one too many! that is why the bank is continuing to work closely with our partners in law enforcement and that is why we are investing heavily in new technology to stay ahead of counterfeiting threats. and we are. the polymer notes we are introducing today are unique. there is simply no other currency like it. these new notes combine transparency, holography and other sophisticated security elements. these new bills are not only more secure ; they are also more cost effective. in addition, we have independently verified that the environmental footprint of polymer notes will be smaller than that of currency made from cotton - based bank note paper. the new bills will last at least 2. 5 times longer than cotton - based bank note paper bills, and after being removed from circulation, for the first time in canada, they will be recycled into other products. safer, cheaper, and greene

ric battellino : will australia catch a us cold? address by mr ric battellino, deputy governor of the reserve bank of australia, to the euromoney forum, new york, 21 september 2011. * * * it is a great pleasure to be taking part in this conference, and in particular to be here in new york again. i have been visiting new york regularly for a large part of my career at the reserve bank. i have always very much enjoyed these visits, but that, of course, was not their purpose. the point of my visits was to find out what was going on in the us economy because, for a long time, this had a major bearing on the australian economy. through the 1980s and into the 1990s, developments in the australian economy showed a close correlation with those in the us economy. it was particularly striking that the recessions of the early 1970s, early 1980s and early 1990s were highly synchronised between the two countries and had many similarities in their nature and origins. as a result, it was common in the 1980s and 1990s to hear the phrase “ when the us sneezes, australia catches a cold ”. australian economists, including those in the reserve bank, spent a lot of time researching the question of why growth in the australian economy was so highly correlated with that in the us. we were intrigued by the closeness of the relationship because the trade flows between the two economies were not particularly large. the united states has always been only a moderately important export destination for australia. the research unearthed various channels that contributed to the close relationship, but two factors seemed particularly important : first, the economic shocks faced by the two countries in the lead up to the recessions of the 1980s and 1990s were similar, as were the policy responses. it was understandable, therefore, that the economies would follow similar paths. second, the financial and cultural links between the two countries have always been very strong. the united states is a large investor in australia and many australian companies have operations in the us. us economic news receives very wide coverage in the australian media. this, in turn, has often promoted very similar movements in financial prices, business sentiment, and even household behaviour. scrutiny of this close relation between the two economies reached its peak around the mid 1990s. ironically, this was around the time when the relationship began to change. certainly, by the first decade of this century, the paths of the economies had clearly diverged. whereas the united states experienced