’ s pace of growth increased somewhat in the second half of last year, and that this persisted in the first few months of 2014. real gdp expanded at an annualised pace of about 3 per cent in the second half of 2013, up from just under 2½ per cent in the first half. business survey readings are broadly consistent with this picture. the march quarter of 2014 saw a further pick up, to something that was above trend, measured either in the quarter or over the year. a key question is the extent to which these recent national accounts data in particular illustrate the likely ongoing pace of growth. the results owed a lot to a very substantial rise in resource exports. this in turn reflected new capacity coming on stream and also unusually benign weather. while further rises in resource export volumes are expected, they are unlikely to be at the same pace. hence, the most recent set of gdp figures, while certainly encouraging, probably overstate somewhat the true ongoing pace of growth in the economy. the bank ’ s forecasts from early may, which we have not materially changed, embody ongoing growth but, in the near term, probably a little below trend. we will provide an update of forecasts next month. we could add sir edward ronald walker, professor of economics at the university of tasmania, adviser to the state government, head of the delegation to the 1945 paris conference, diplomat and chair of the un committee on full employment in the late 1940s. we could also mention professor gerald firth, who travelled from the uk to take up the ritchie research fellowship funded by giblin at the university of melbourne, was a senior economist in the department of post - war reconstruction and was professor of economics at utas for around 30 years. see charles bean, < http : / / www. bankofengland. co. uk / publications / pages / speeches / 2014 / 729. aspx >. it ’ s remarkable that sir roland wilson was, according to coleman et al., the first university graduate appointed to an administrative position in the commonwealth public service, in 1932. bis central bankers ’ speeches what are some of the key features of this outlook? the world economy continues to show moderate growth, probably a little below average but not by all that much. the advanced countries are seeing somewhat better outcomes than last year overall, while some emerging market economies slowed somewhat during the first half of 2014, including china. looking at domestic economic policies, the stance of monetary policy is very acc

##ence to shocks. these are the reasons why the ecb and the eurosystem have an important stake in financial stability in the euro area. complex to define, financial stability is not only of the essence in avoiding financial crises but also in paving the way for the best financial environment in normal times. it is a condition where the financial system is capable of performing well in normal times all of its normal tasks and where it is expected to do so for the foreseeable future. from this viewpoint, financial system stability requires that the principal components of the system – i. e. financial institutions, markets and infrastructures – are jointly capable of absorbing smoothly a full array of adverse disturbances. it requires that the financial system is facilitating an efficient reallocation of financial resources from savers to investors, that financial risk is being assessed and priced accurately and that risks are being efficiently managed. financial stability also has an important forward - looking dimension. for instance, inefficiencies in the allocation of capital or shortcomings in the pricing of risk can, by laying the foundations for future vulnerabilities, compromise future financial system stability and therefore economic stability. three steps are needed to produce a comprehensive picture of the stability of the financial system. the first entails forming an assessment of the individual and collective robustness of the institutions, markets and infrastructures that make up the financial system. the second involves an identification of the main sources of risk and vulnerability that could pose challenges for financial system stability in the future. the third and final step is an appraisal of the ability of the financial system to cope with crisis, should these risks materialise. the overall assessment will determine whether remedial action is needed. it is important to bear in mind financial stability analysis is very different from the analysis that underpins our monetary policy assessment. financial stability analysis has a focus on calling attention to potential sources of risk and vulnerability to the functioning of the financial system and it does not aim at identifying the main – or most likely - future scenario for the euro area economy. it neither aims at identifying the full balance of risks surrounding this main scenario as is the principal focus in the monetary policy assessment and decision - making process. rather it entails the highlighting of potential and plausible sources of negative events, even if these are remote and very unlikely. as was the case with the preparation of the december 2004 financial stability review, the analysis contained in this review was prepared with the close involvement of, and contribution by,