to be accomplished. financial sector reform the financial crisis revealed all too starkly that liquidity buffers were glaringly inadequate, and that the global banking system as a whole was dangerously undercapitalized and overleveraged. to redress this core vulnerability, new global standards in the form of basel iii have been agreed. they substantially increase the loss - bearing capital that financial institutions must hold and establish new liquidity standards and a limit on leverage. these new standards represent a significant strengthening of the global rules. the combination of greater emphasis on true loss - bearing capital – namely, tangible common equity – and increased minimum capital levels has effectively raised the minimum global capital requirement seven times. moreover, for the largest and most interconnected global banks, these requirements are being supplemented with additional loss - absorbing capital. these are major accomplishments. the new rules must now be assiduously implemented in every institution. all jurisdictions must ensure strong supervision and oversight. scrupulous international assessment must ensure equivalent implementation of these new higher standards. furthermore, we must agree on and implement a perimeter of regulation and oversight that encompasses all systemically important financial institutions, markets and instruments. and a new system of firewalls needs to be built to prevent the failure of one counterparty in the over - the - counter derivatives market from creating systemically perilous knock - on effects. in short, much has been achieved and much remains to be accomplished. it is critically important that the momentum driving financial sector reform be maintained. g - 20 framework for strong, sustainable and balanced growth progress on the framework for strong, sustainable and balanced growth has lagged that of financial sector reform – and needs to accelerate. the g - 20 leaders launched the framework in 2009, just as the global economy began recovering. their goal was to safeguard the nascent recovery and achieve stronger global growth over the medium to long term. leaders recognized the importance of beginning in the early stages of the recovery to put in place policies that would foster the adjustments needed to sustain recovery, prevent a re - emergence of global imbalances and support financial stability. at the toronto g - 20 summit in 2010, agreement was reached on a comprehensive, threepillared policy package to support stronger, more sustainable and more balanced growth. it included : fiscal consolidation in advanced countries that is credible and clearly communicated ; g - 20 working group on enhancing sound regulation and strengthening transparency, “ final report. ” 25 march 2009, which can be found at : < http : /

have confidence in your forecast, incoming data may challenge that confidence. you neither want to overreact to incoming data nor do you want to ignore it. 3 / 5 bis - central bankers'speeches i am bringing this up because i hear from some quarters the claim that the fomc has become " overly data dependent. " this is a phrase that honestly doesn't make much sense to me but is apparently supposed to mean that we are over - reacting to data and allegedly sending confusing messages about the stance of monetary policy. i don't see how that argument applies to the views of the fomc, if one looks at the summary of economic projections ( sep ). between the march sep in 2023 and march 2024 sep, the committee median was relatively consistent in projecting around three rate cuts in 2024. this was in the face of some pretty dramatic shocks to the economy. there were the bank failures and wider stress in the financial system in the spring of 2023, when it was far from clear what the ultimate effects would be on the economy. there were significant fluctuations in inflation, which was hot in the first half of last year and then dramatically cooler in the second half. there was the revelation, over time and in different data, that a surge in immigration was augmenting labor supply and allowing a surge in job growth with very little upward pressure on wages and inflation. and then there were geopolitical developments, such as the threat that war in the middle east might spread to become a wider conflict. against this backdrop, the median fomc participant only gradually reduced their expectation for the unemployment rate at the end of 2024 and essentially left inflation unchanged. associated with this outlook, the median projection for the appropriate level of the federal funds rate at the end of 2024 moved by at most 50 basis points between the four seps over 2024, and more or less held to the median of three 25 basis point rate cuts over the past year. this hardly seems like an " overly data dependent " fed to me. for illustration purposes, contrast that with how the private sector reacted to developments in 2023. the implied federal funds rate based on overnight interest swap quotes for the end of 2024 see - sawed between 2 rate cuts and 10 cuts - for a few days, markets even predicted 11 cuts - and by the end of 2023 ended up implying 6 cuts. i make this comparison not to denigrate what markets were doing - they were simply