##ulation, liberalisation, and competitive forces, it is important that the various indices such as wpi or iip, which attempt to capture the underlying developments in the economy, are refined and updated on a continuous basis to provide timely information to the policymakers. third, in the context of more open economies and improvements in communication, market dynamics have become sensitive to data releases and information dissemination. all of us are aware of how market participants oftentimes misinterpret information, triggering considerable volatility in markets. we can help manage expectations and perceptions better by focussing attention on data standards as well as improving the quality of our statistics education. this is the third challenge. i hope this conference will come up with some specific thoughts on how we may address these above challenges. statistical surveys done by rbi since this seminar is focussed more narrowly on statistical surveys, let me briefly comment on the surveys done by the reserve bank. we do regular periodical surveys as well as needbased ad hoc surveys. our surveys in the external sector cover foreign liabilities and assets, software exports and non - resident deposits, etc. in the banking sector, the surveys cover distribution of credit and deposits, composition and ownership of deposits, international banking statistics, and the like. in the corporate sector, the survey of performance of private corporate business sector, conducted since 1951 - 52, has been of considerable interest to analysts. the reserve bank has also introduced several new surveys to support monetary policy formulation. these include the industrial outlook survey, inflation expectations survey for households, survey of inventories, order books and capacity utilization and survey of professional forecasters. we are also working on a survey for housing start ups. the biggest challenge for us here has been collecting information from each state / city on building permits and coming up with a reliable matrix of house - start coefficients. the special value of these new surveys is that they include information from key actors, they are forward - looking and the results are available in quick time. such survey results provide useful and timely inputs for the conduct of forwardlooking macro - policies. statistics in the rbi's work at the reserve bank, honing our skills and improving our database is a constant endeavour. we have achieved some satisfactory progress, but there are daunting challenges still. let me illustrate by giving five problems that we confront in the area of data analysis. ( i ) data revisions measuring the economy remains a complex task and data uncertainty is a fact of life. data

oil as well as in other non - oil commodities has been increasing. an example of the risks that can be posed by such activity in non - oil commodities markets was the episode involving the amaranth advisors hedge fund that collapsed in september. the fund ran into difficulties after its leveraged bets in the natural gas futures market – which had been predicated on expectations of hurricane frequency and intensity that did not materialise – suddenly turned sour. regarding oil spot prices, after reaching new historical highs in early august, they subsequently declined substantially but have remained at high levels. the decline was mainly attributable to a reduction in geopolitical tensions, a receding threat of hurricanes in the gulf of mexico and an easing of petrol market tightness. all of these factors led to a decline in speculative positions which contributed to the rather abrupt downward adjustment in the price of oil. looking forward, the implied probability distribution of future oil prices, extracted from options contracts, indicates that considerable uncertainty surrounds near - term oil futures prices, with very wide confidence intervals. moreover, the balance of risks is tilted towards the upside [ see chart on the right of slide 3 ]. iii. 2 global and euro area financial markets when assessing the potential risks in the global and euro area financial markets, two main sources of vulnerability can be identified. the first concerns the persistently low levels of long - term interest rates and credit spreads which have been associated with a “ pricing for perfection ” in corporate sector capital ( credit ) markets and emerging economy debt markets in the sense that valuations in these markets appear to be based on very favourable expectations regarding future economic outcomes and low risk premia. the second concerns the growth in the volume and complexity of credit derivatives markets, coupled with the increasing presence of hedge funds in these markets. an abundance of liquidity in global financial markets, although its rate of growth has moderated, together with very high saving rates in some emerging market regions relative to domestic investment opportunities partly explain why long - term interest rates and credit spreads have been remarkably unperturbed by the shift to less accommodative monetary policies in the g3 economies and the resulting withdrawal of global liquidity. rising short - term interest rates have instead produced flatter, or inverted, market yield curves in the six months following the finalisation of the june 2006 fsr. [ see chart on the left of slide 4 ] the renewed “ conundrum ” of low long - term government bond yields seems, in part,