However, our foreign exchange market has remained stable overall, and the market expectations on the exchange rate and the cross-border capital flows have also remained relatively stable. Looking forward, China's economy will generally maintain a steady and upward trend, while some market institutions are predicting that the US economy may face a mild recession.
The system as a whole can also encounter difficulties if, owing to interdependencies, the rational conduct of market participants at the individual level were to lead to market dislocations in the aggregate. I draw three direct conclusions from the foregoing, which are related to one another and should be main elements of the policy response to the crisis.