Macroprudential space The experience of the initial phase of the pandemic illustrated the importance of having sufficient releasable capital buffers in the banking sector. When the pandemic struck in early 2020, macroprudential authorities in the euro area had little room for manoeuvre to release macroprudential capital buffers.
Global financial safety nets have been successfully strengthened under the Korean and French G-20 presidencies, and there is room for further improvement. But measures aimed at addressing liquidity crises should remain temporary, and they should not weaken the incentives to address financial market malfunctioning in a more durable manner. Even more importantly, safety nets are there only to address unexpected events.