Further work is also needed to improve our macroprudential approach to managing vulnerabilities. And we must collaborate to ensure that risky activities do not migrate to the shadows of the financial system in an attempt to circumvent regulatory authorities. We must also strengthen the international monetary system. We need a system characterized by more open capital accounts, flexible exchange rates, and independent monetary policies.
Open capital accounts, supported by appropriate financial supervision and regulation, channel savings to their most productive uses, thereby enhancing welfare. Exchange rate flexibility improves domestic macroeconomic management, allowing countries to pursue independent monetary policies tailored to their individual needs, and limits unwelcome spillovers to other economies.