In fact, bilateral and multilateral arrangements may also have a critical role to play in addressing the risks from tapering. Markets were soothed when we recently increased the quantum of our swap lines with Japan. These are contingency lines which we do not expect to use but nevertheless they provide the comfort of a backstop.
Central banks must monitor financial market developments very closely in order to figure out what the consequences are for the outlook for price stability over the medium term, but they must not target asset prices. Finally, and this is my last point on monetary policy, I would like to stress that effective communication is an all-important requirement for successful monetary policy.