board identified the rise in card - not - present fraud as a priority for the industry. in august this year, the board was pleased to welcome auspaynet ’ s publication of a draft industry framework to mitigate card - not - present fraud, and supports continued collaboration on this issue. a separate but not unrelated priority for the industry is to progress work on digital identity. this is another area where barriers to effective coordination can arise. i am pleased that auspaynet is undertaking work here, under the auspices of the australian payments council. digital identity is likely to become increasingly important as more and more activity takes place online. the rba is highly supportive of industry collaboration on this issue and views it as important that substantive progress is made. more broadly, individuals, businesses, governments and financial institutions all need to be aware of cyber risks. in the rba ’ s most recent financial stability review we noted the increasing sophistication of cyber attacks and that regulatory authorities have increased their focus on cyber issues. 9 / 14 bis central bankers'speeches reliability a third factor is the confidence that people have that they will be able to use the electronic system when they need to make their payments. as i noted earlier, people will still want to hold and use banknotes if they can ’ t be sure that the electronic system will be available when they need it. in our consumer payments survey in 2016, we asked people about why they held cash in places outside of their wallet. the most common response, from nearly half of respondents, was that it was for emergency transaction needs. over recent times, there have been a number of serious operational incidents that have interrupted the payments system. on some occasions these have been caused by problems with the telecommunications companies and at other times by problems at the banks. an operational incident at the rba in august as a result of problems with a routine fire test also saw a number of rba core systems unavailable for some hours, including the fast settlement service supporting the npp. we all need to do better here. as we rely less on cash, outages affecting retail transactions can have a significant impact on businesses and individuals. so continued effort needs to be made by all participants in the payments system to reduce operational problems. if this does not happen, then it is possible that the payments system board could consider setting some standards. 3. increased focus on cost and competition my third broad point is about the cost of electronic payments and the importance of competition. as we

begin unwinding its policy in the near future is a welcome development. it will likely reflect stronger u. s. economic performance, which should favor the world economy, especially those countries most closely linked to the united states. normalization, in turn, is a precondition for containing the accumulation of possible vulnerabilities that could eventually jeopardize global economic improvement. in any case, the future likely scenario for advanced nations is one of divergent monetary paths. while the united kingdom will perhaps be next after the united states in unwinding stimulus, the european central bank, the bank of japan and other major central banks could further loosen monetary stances. the pace in each direction is highly uncertain. for an estimation of real effects of unconventional monetary policy, see, for example, engen, e. m., et al. ( 2015 ), “ the macroeconomic effects of the federal reserve ’ s unconventional monetary policies, ” board of governors of the federal reserve system finance and economic discussion series 2015 – 005, january ; and wu, j. c. and f. d. xia ( 2014 ), “ measuring the macroeconomic impact of monetary policy at zero lower bound, ” chicago booth research paper 13 – 77, july. two analyses on the possible real consequences of deflation are : atkeson, a. and p. j. kehoe ( 2004 ), “ deflation and depression : is there an empirical link? ” american economic review, 94 ( 2 ) ; and ryska, p. ( 2014 ), “ deflation and economic growth in long - term perspective, ” charles university in prague, institute of economic studies working paper 18 / 2014. for a review of possible risks from prolonged monetary expansion, see hannoun, h. ( 2015 ), “ ultra - low or negative interest rates : what they mean for financial stability and growth, ” speech at the bis eurofi highlevel seminar, april. bis central bankers ’ speeches effects on emerging economies unconventional monetary policies in developed countries have had significant bearing on emerging markets. financial stabilization in a u. s. economy overwhelmed by the global turbulence was clearly positive, as it mitigated significant outward contagion. to the extent that a larger collapse was avoided, other countries benefited, a comment that can also be extended to the subsequent u. s. economic rebound. the search for yield stemming from abundant liquidity since 2010 has translated into substantial capital flows, especially portfolio