circumstances of the crisis and has helped to restore confidence in financial markets. having said that, financial and economic conditions do differ across the major countries, and we should not expect that coordination means uniformity of action. monetary policy in the different areas of the world needs to take into account the specificities related in particular to the shocks that affect the economies and the transmission mechanism of monetary policy. when these specificities are appropriately taken into consideration, the actions of the various monetary authorities appear overall quite homogeneous and consistent. appendix : figure 1 : developments in volatility panel a : realised volatility equity markets euro / dollar exchange rate panel b : implied volatilities source : bloomberg, thomson financial datastream and ecb staff calculations. note : daily data, % annualised. last observation 10 march 2009. figure 2 : developments in the term structure of the euro / dollar rate volatility note : the chart shows the implied volatilities, at selected dates, taken from at - the - money options on the euro / dollar rates, at the six options ’ maturities reported on the x - axis. figure 3 : euro / dollar rate : bid - ask spread and volatilities note : weekly data ; last observation is 16 march 2009 ; the bid - ask spread is expressed as a percentage of the spot rate. implied and realised volatilities are expressed as percentages in annualised terms. figure 4 : developments in main bilateral rates note : daily data since 1 sep. 2007 ; last observation 17 march 2009. figure 5 : changes in the nominal effective and in selected bilateral rates of the euro

through which the financial turmoil spread from money markets to longer term cross - currency swap markets. vis - a - vis the currencies of 21 important trading partners of the euro area. imf, world economic outlook report ( october 2008 ), p. 54. source : us department of the treasury, treasury international capital system, http : / / www. ustreas. gov / tic /. global risk aversion and increased home bias. the functioning of erm ii was overall not adversely impaired, despite the exceptional rise in foreign exchange volatility. other dimensions of international monetary coordination apart from exchange rate policy, there are other important aspects of international monetary coordination which have come to the fore in the current crisis. on top of their regular exchanges of information and views, central bankers have engaged in unprecedented joint actions to provide liquidity, reduce financial market strains, and counter negative spillover effects on the real economy. for example, on 8 october 2008 the ecb cut interest rates simultaneously with six other central banks, against a backdrop of lower inflationary pressures. another example can be found in the area of liquidity management. a key tool in this respect has been the us dollar term auction facility, in which the ecb agreed with the us federal reserve to grant loans in dollars to euro area banks. these usd liquidity - providing operations have increased over time in terms of size and number of participants, with a substantial number of central banks now participating. the eurosystem has also entered into an agreement with the swiss national bank in order to facilitate the provision of liquidity denominated in swiss francs to euro banks. finally, the eurosystem has signed agreements with the central banks of several european countries in order to improve the provision of euro liquidity to their banking sectors. since the start of the crisis, we have therefore achieved a level of trust and cooperation within the central banking community that some would have considered unthinkable a couple of years ago. as the ecb president put it a couple of weeks ago, global cooperation by central banks is now mirroring the globalisation of finance. conclusions to conclude, the euro area has an exchange rate policy and it has been implementing it over the last ten years, with full cooperation between the authorities in charge, including over the recent months. international monetary coordination has gone beyond exchange rates, and involved several aspects of central banking, including on one occasion a coordinated interest rate change. such coordination is aimed at the specific