although the three federal banking agencies included a countercyclical capital provision in the capital regulation to implement basel iii adopted last summer, the provision will not take effect in the united states until 2016. however, when the countercyclical capital buffer provision of basel iii does come into effect in the united states, we will have the benefit of experience for this tool from other countries. over the past year, the norges bank, the reserve bank of new zealand, and the financial policy committee at the bank of england have all finalized general statements on how this policy lever will operate in their jurisdictions, with implementation in each case proceeding in advance of when the policy will come into effect under basel iii. 12 moreover, in december, the norwegian ministry of finance accepted the advice of the norges bank to activate a countercyclical capital buffer in the face of rising financial imbalances. the level of the buffer will be set at 1 percent of risk - weighted assets, starting july 1, 2015. 13 the foregoing discussion has considered the ways in which existing supervisory authority and new forms of macroprudential authority may allow monetary policymakers to avoid, or at least defer, raising interest rates to contain growing systemic risks under circumstances in which policy is falling well short of achieving one or both elements of the dual mandate. however, as has doubtless been apparent, i believe these alternative policy instruments have real limitations. as i noted earlier, i do not think that at present we are confronted with a situation that would warrant a change in the monetary policy we have been pursuing. but for that very reason, now is a good time to consider these issues more actively. one useful step would be development of a framework that would allow us to make a more analytic, less instinctual judgment on the potential tradeoffs between enhanced financial stability and reduced economic activity. this will be an intellectually challenging exercise, but in itself does not entail any changes in policy. monetary policy and financial system i have to this point described the possible need to balance longer - term financial stability and shorter - term economic growth considerations in the implicit context of a specific point in time, with the decision on use of supervisory, macroprudential, or monetary policy tools dependent on the level and nature of the potential systemic risk, the likely efficacy of each tool in containing that risk, and the expected side effects of each tool on growth. but in thinking about the relationship between monetary policy and financial stability, it is also worth taking

), laubach and williams ( 2015 ), and johannsen and mertens ( 2016 ). see hamilton and others ( 2015 ), del negro and others ( 2015 ), and chapter 3 of world economic outlook ( international monetary fund, 2014 ). while the empirical link between potential growth and the neutral rate is not precisely estimated, the evidence suggests that slower trend growth is associated with lower interest rates ; see laubach and williams and hamilton and others ( 2015 ). u. s. labor force growth has slowed from 1 percent from 2001 to 2004 to 1 / 2 percent over the most recent 4 years. over the same periods, euro - area growth has slowed from 1. 3 percent to 0. 4 percent. in japan the labor force was essentially flat from 2011 to 2015, though this was a slight improvement from a small rate of decline in the early 2000s. productivity growth over the same periods has slowed from 3. 0 percent to 0. 5 percent in the united states, from 0. 6 percent to 0. 2 percent in the euro area, and 1. 5 percent to 0. 5 percent in japan. regarding sensitivity to risk, the risk premium for capital investment appears to have increased since the crisis ; see del negro and others ( 2015 ). a higher risk premium requires a lower risk - free rate to generate an equivalent level of investment. from the end of 2009 to the end of 2013, growth in important u. s. emerging market trading partners averaged 4. 7 percent, while growth in advanced economies averaged 1. 8 percent. however, in 2014 emerging country growth slowed to 3. 3 percent, compared with 1. 6 percent in advanced economies, and for the first three quarters of 2015, annualized growth was 2. 5 percent and 1. 1 percent, respectively. bis central bankers ’ speeches nickel. commodity exporters and close trading partners in asia will be most affected, but the changes in the composition and rate of growth in a country that has accounted for about onethird of the growth in world output and trade will likely ripple through the global economy much more generally. amplified spillovers of course, policy divergence among major economies could be limited by rapid and strong transmission of foreign shocks across borders. in particular, although the u. s. real economy has traditionally been seen as more insulated from foreign trade shocks than many smaller economies, the combination of the highly global role of the dollar and u. s. financial markets and the proximity to the zero lower bound