coverage ratio ratio ratio * leveraged asx - listed non - financial corporates. interest coverage ratio calculated as ebitda / interest expenses. sources : morningstar ; rba. tighter financial conditions are likely to have had a stronger effect on businesses with higher pre - existing leverage and generally weaker balance sheets, as well as smaller businesses which do not have access to wholesale funding markets. indicators of business financial stress generally remain low, although many businesses are experiencing challenging conditions and the share of businesses entering insolvency has increased since early 2022 ( graph 11 ). this is particularly so for businesses in the construction and hospitality sectors, although this follows a period of very low insolvencies owing to pandemic - related support measures. most of these firms entering insolvency are small businesses with little debt. [ 12 ] rates of non - performing loans have also increased slightly but remain low by historical standards. graph 11 company insolvencies share of total businesses operating, quarterly % % 0. 15 0. 15 0. 10 0. 10 0. 05 0. 05 0. 00 sources : abs ; asic ; rba. r e s e r v e b a n k o f au s t r a l i a 0. 00 conclusion looking across a range of measures shows that monetary policy tightening has led to restrictive financial conditions. however, the extent of this varies across different sectors and also within sectors. households have been responding to higher interest rates. while households with mortgages are significantly affected, and quite directly, consumption growth is weak for most people. smaller businesses, and businesses with higher leverage, are also facing financial pressures, much more so than many larger businesses. notwithstanding these differences, restrictive financial conditions are helping to slow the growth of demand, thereby bringing the level of demand into better balance with supply. this is contributing to the decline in inflation, which is to the benefit of all australian households and businesses. endnotes [ * ] i thank sue black, shan jayawardhana, dmitry titkov, peter wallis, charlie wenk and ada zhou for their great assistance in helping to prepare this speech. i say ‘ one way to gauge ’ because the stance of monetary policy is somewhat broader than the current level of the cash rate and incorporates expectations for future cash rates as well as the size and composition of the rba ’ s balance sheet. however, in normal times, the level of the cash rate relative to the neutral rate is a reasonable

janet yellen : strong foundations - the economic futures of kids and communities welcoming remarks by ms janet l yellen, chair of the board of governors of the federal reserve system, at the 10th biennial federal reserve system community development research conference " strong foundations : the economic futures of kids and communities ", washington dc, 23 march 2017. * * * i would like to welcome all of you and thank you for joining us to discuss a set of topics of considerable importance to our country. this is the federal reserve ’ s 10th biennial community development research conference, dedicated as always to issues of significance to people and communities around the country. the conference is cosponsored by, and includes substantive contributions from, the community development offices of all 12 federal reserve banks as well as the board of governors. that united effort and level of commitment reflects how consequential we consider these issues to be. this conference is intended to present and highlight rigorous research that i am confident will inform how you think about your own work, whether from the perspective of policymaking, community development practice, or research. our last conference, two years ago, explored various aspects of economic mobility, largely among adults. this year, we gather to discuss “ the economic futures of kids and communities, ” and, in part, i see this topic as an extension of that earlier conversation about mobility. today and tomorrow, we focus on research about the foundation or building blocks for economic success that are laid even before young people enter the workforce and assume responsibility for their own finances. we will hear from leading experts on a range of issues related to how children, youths, and young adults are shaped in ways that may ultimately affect their ability later to productively contribute to the economy and manage their finances. we can learn from what the data and analysis tell us, and our hope is that making use of this information will lead to more effective programs and policies and thus better outcomes. considerable evidence shows that growing up poor makes it harder to succeed as an adult, and new research by the fed likewise shows the strong connection between the typical experiences of poverty in childhood and economic challenges later as an adult. the data come from the board ’ s latest survey of household economics and decisionmaking ( shed ), which will be published later this spring. 1 in the most recent survey, we asked some of the younger respondents — aged 25 to 39 — to think about their childhoods. we asked those young adults whether, during their childhoods, they found themselves worrying