Let us remind ourselves what we are trying to achieve with our current monetary policy objective of 2 per cent inflation. The most obvious answer is low, stable and predictable inflation. In previous eras, episodes of runaway inflation in this country and others led to major recessions and years of stagnant growth.
Serious tension continued in the financial markets until central banks including the Bank of Japan began to provide US dollars through bi-lateral swap lines arranged with the US Federal Reserve. BIS banking statistics and other sources of information help us fill the gaps in the current account data.