interdependence of our economies. statistics and charts on the movement of people and the exchange of ideas, information and technology are more difficult to come by, but i believe that they would give the same sense of the velocity of the process. globalisation and inflation dynamics what are the implications of globalisation for the functioning and performance of national economies and for the conduct of economic and monetary policies? can we measure its overall effects on key macroeconomic aggregates, such as inflation and output growth, of individual countries? these are broad and challenging questions. i will first focus on one issue that has received attention recently and is relevant for monetary policy : the effects of globalisation on inflation and its dynamics. globalisation has two main direct effects on inflation, which partly counterbalance each other. on the one hand, some resources are becoming less scarce on a global scale, notably investment opportunities and skilled labour. on the other hand, other resources have become scarcer relative to world demand : these are raw materials and basic commodities, most importantly oil and other sources of energy. let us look at each aspect in turn. the integration of an enormous reserve of low - cost, skilled labour in the international economy has put downward pressure on import prices of manufactured goods and on wage demands in industrial economies. as a consequence, the prices of a wide range of manufactured goods have been declining. furthermore, through various channels this process of wage moderation and reduced inflationary pressure in the manufacturing sector has affected wage dynamics also in the services sector mainly as a result of outsourcing, especially in english - speaking countries. these effects of global integration have helped reduce inflationary pressures. it is difficult, however, to estimate the size of their impact with great precision. at the same time, certain other resources have become scarcer : the integration of rapidly growing large emerging market economies has put upward pressure on energy and commodity prices. this impact is more visible and relatively easier to quantify. in the euro area, the trend and dynamics of the consumer price level ( as measured by the hicp, that is, the harmonised index of consumer prices ) and of the import prices of energy, raw materials and manufactured goods ( as measured by the respective import unit value indices ) have been very diverse over the past decade, especially since 1999. as shown in chart 6, since that year the import price of energy products has more than tripled, reflecting the effects of both demand and supply - side factors. the import price index

seeing. together – and working with all of you in industry, i hope that global ccp regulators can find ways to begin to address the lessons i have just laid out : tackling the side effects without sacrificing the cure ; dealing with situations in which history is not a good guide to the future ; and understanding the structural factors that can lead to big price moves. addressing the issues we have seen in march 2020 and again in 2022 is both urgent and important. cooperation will give us a strong foundation on which to enhance the crucial role ccps play in supporting global financial stability as we address vulnerabilities that have become evident in recent stress. i am grateful to sarah crowley, chandima wijerathna, dan wright, don payagala, michael wood, pavel chichkanov and shriya mrug for their help in preparing these remarks. i am also grateful to jon cunliffe, andrew hauser, david bailey, nathanael benjamin, sarah breeden, andrea rosen, imane bakkar, martin arrowsmith, simon morley, justin jacobs, barry king and jaynika patel for their helpful comments. 1. the ftse all - share index fell over 10 % on 12 march, the largest one - day fall since 1987. other markets also saw shocks beyond or close to the largest in history. 2. fsb ( 2017 ) report on effectiveness of derivatives reforms. 3. by march 2020, 60 % of credit default swaps were cleared, and 80 % of interest rate contracts, up from about 10 % and 40 % respectively in 2008. 4. review of margining practices ( bis. org ) 5. from lender of last resort to market maker of last resort via the dash for cash : why central banks need new tools for dealing with market dysfunction ( bankofengland. co. uk ) 6. vm calls were six times larger compared to normal levels on 1 march 2022 ( £34billion ), compared to a five - fold increase on 18 march 2020 ( £29billion ). vm calls at the most affected clearing services were as high as 35 times normal levels ( lme base ). 7. total im requirements of uk ccps peaked at around 30 % higher relative to their pre - stress levels in q1 2020. the peak aggregate increase in q1 2022 was 13 % ( relative to 1 february 2022 ). 8. review of margining practices ( bis