Macroeconomic instability and developments in the international environment have also impacted foreign inflows to these countries. In this scenario financing external current account deficits is a challenge complicated further by the exceptional rise in sovereign spreads in international markets as the liquidity constraints deepened. 12. Implications for financial markets.
I would like to take this opportunity to make some remarks on this issue in the German context: Firstly, collaboration between the Bundesbank and BaFin has worked well, both before and during the crisis. Secondly, the Bundesbank did not ask to be given full responsibility for banking supervision. Rather it was an objective of the political parties that have won the federal elections.