from abroad are also included, but these components usually account for a much smaller part of the total than net exports. for a more detailed discussion, see lane, 2010. bis central bankers ’ speeches figure 1 current accounts, private net capital and gdp in eastern and central europe percentage of gdp and annual percentage change gdp current account private capital - 5 - 5 - 10 - 10 note. private capital is made up of direct private investment ( net ), private portfolio flows ( net ) and other private capital ( net flows ), expressed here as a share of gdp. source : the imf global imbalances have increased since the deregulation of the capital markets at the end of the 1980s. one of the reasons for this is that countries with surpluses, such as china, have grown more rapidly than other countries. the higher rate of growth means that china ’ s savings surplus ( the difference between saving and investment ) has increased as a percentage of global gdp. as the current accounts in the world must in theory total zero, this means that other countries must have increasing deficits to a corresponding degree. 7 on the deficit side, the unites states stands out in that it alone has accounted for three - quarters of the world ’ s total current account deficit. the united states has also been in deficit for a very long time, as much as 20 years. the countries that have a surplus, and that in practice thus lend money to the united states and other countries with deficits, have primarily been a number of oil - producing countries and china, but also include japan, germany and some other asian countries ( see figure 2 ). there is however a discrepancy for the world as a whole, see figure 2. bis central bankers ’ speeches figure 2 current accounts around the world percentage of global gdp usa oil exporters germany and japan ocadc china and emerging asia rest of the world discrepancy - 1 - 1 - 2 - 2 - 3 - 3 note. ocadc comprises bulgaria, croatia, czech republic, rumania, hungary, ireland, lithuania, poland, portugal, estonia, greece spain, turkey and the united kingdom. source : imf weo april 2011 current account surpluses or deficits are not bad in themselves and do not necessarily entail an unsustainable imbalance in the long term. in a globalised world they are a natural consequence of the different conditions in different countries in terms of factors such as demography, the degree

on arguments such as these, i entered a reservation against the decision in november 2020 to extend and extend the asset purchase programme, see appendix and my comments at the monetary policy meeting ( riksbank 2020c, p. 21 - 24 ). 15 i want to use my ( long! ) review of the experience of asset purchases since 2015 to try to evaluate whether financial losses are offset by other gains for the national economy. i shall also discuss whether the losses will weaken the riksbank's financial independence and, in that case, make monetary policy less effective. but let me first focus a little more on the financial losses. how has the riksbank's balance sheet been affected by the purchase of assets, and how has the value of the assets we have purchased developed? the riksbank's financial results are now deteriorating prior to the global financial crisis, the riksbank's balance sheet was relatively small and uncomplicated. the size of the balance sheet, corresponding to approximately 6 per cent of gdp, was determined mainly by the liabilities side, which was dominated by banknotes and coins in circulation and the riksbank's equity. on the assets side, these liabilities were matched by the foreign exchange reserve, which consisted mainly of us and european government bonds. the liabilities side was therefore mainly not remunerated ( we do not pay any interest on notes and coins ), while we collected interest on government bonds. with interest rates around 4 per cent, the riksbank could finance its current operations and yet deliver a surplus of several billion sek a year to the central government budget. today, the balance sheet looks completely different ( see figure 11 ). the balance sheet total now corresponds to 28 percent of gdp, and the liabilities side is dominated by debt securities. and since the debt has a very short maturity ( overnight or one week ) while the bonds on the asset side have long maturity, the interestrate risk is considerable. 29 the rapidly rising interest rates recently therefore mean that the riksbank will report a large loss this year. there are different ways of explaining how the level of interest rates affects the riksbank's results. the easiest way is probably to use market values as a base : the riksbank has purchased fixed - rate bonds. when interest rates rise, the market value of the bonds falls. another approach is based on the riksbank's liabilities side : on the assets side.