extremely difficult ). conversely, within the academic literature, “ flow effects ” refer to those effects that emerge through the actual implementation of the purchases and generally reflect improvements in liquidity conditions and market functioning during periods of high financial stress. the evidence suggests that flow effects are typically contained and short - lived. it is notable, however, that the term “ flow effects ” has at times been used in relation to the high pace of asset purchase programmes carried out in response to the covid - 19 crisis, for which only the envelope and duration were defined at the time they were announced. from this perspective, flow effects help to signal the central bank ’ s commitment to providing ample policy accommodation and reassure market participants about the presence of central banks as large and patient investors. 9. the extraction of duration risk associated with the stock of securities held by the ecb loses potency over time because the residual maturity ( and hence the duration ) of all securities shrinks over time. and reinvesting maturing securities falls short in terms of making up for this loss. as the extraction of duration risk smoothly recedes over time, the stock effects on term premia tend to recede. moreover, the size of our balance sheet will tend to decrease relative to other economic variables. 10. brainard, w. c. ( 1967 ), “ uncertainty and the effectiveness of policy ”, the american economic review, vol. 57, no 2, pp. 411 - 425. 11. coibion, o., georgarakos, d., gorodnichenko, y. and van rooij, m. ( 2019 ), “ how does consumption respond to news about inflation? field evidence from a randomized control trial ”, nber working paper series, no 26106, national bureau of economic research, july. based on a survey of dutch households in which random subsets of respondents receive information about inflation, the paper shows that an increase in inflation expectations leads to a sharp negative effect on durable spending and that this is likely to be driven by the fact that dutch households seem to become more pessimistic about their real income. 12. see the european business and consumer survey results for april 2022, which show a significant realised and expected deterioration of households ’ financial situation and major purchases. 13. see bank of america ’ s global fund manager survey, may 2022. global growth optimism is defined as the net share of fund managers expecting a stronger economy. it has reached

( q4 2012 ) still ranks one of the lowest in the region. 4 this would suggest that the risk of excessive leverage is less and the threat to financial stability is likewise lower, should asset prices correct. the third challenge involves going the distance in the pursuit of the reform agenda. 1. we are implementing the capital adequacy framework of basel iii in january 2014. we will also be closely studying the other building blocks of the basel iii reform agenda to see how and when we can incorporate these into domestic regulatory environment. 2. capital market reform will be a priority. this will include ensuring that an appropriate market infrastructure is in place. the infrastructure will not only improve the quality of markets, which will help mitigate financial stability risk. but infrastructure will also promote the absorption of the inflows, which will ultimately lead to an expansion of the economy. by improving financial intermediation in the system, a well - functioning capital market will help unlock the economy ’ s productive potential and strengthen its capacity to withstand shocks. right now, we see an economy that is on an even keel, on surer footing, poised for higher growth, riding on a momentum of change that offers the promise of not only stronger growth but also one that is more inclusive and more durable. note : latest available : indonesia 40. 2 ; malaysia 133. 3 ; singapore 151. 8 ; thailand 129. 4 ; japan 221. 2 ; china 153. 1 ; korea 104. 1 bis central bankers ’ speeches the challenge is to keep the momentum of positive change strong. the appropriate response to current favorable winds is not to sit back and relax, not to pop champagne corks as william asked this morning, but to treat them as an ideal opportunity to strengthen the underpinnings of the economy ’ s foundations. the bsp will strive to have monetary policy that will provide an environment where credit and liquidity growth will remain supportive of economic growth while maintaining price stability. we will also continue to work on reforms that will deepen the financial system. we will continue to monitor financial and asset markets and be responsive to emerging risks. we will continue to work with the government in pushing the agenda for reforms to ensure macroeconomic stability. bis central bankers ’ speeches