The nature and scale of the spillover effects have been dependent on the extent of trade and financial linkages. The crisis and the continued weakness in the advanced economies have also underlined the need for emerging economies to diversify traditional trade and financial relationships.
BIS central bankers’ speeches  1  We also considered carefully the matter of financial stability risks. For the past couple of years, we have seen periods of downside risk to the inflation profile, but the horizon over which we believed inflation would return sustainably to target remained reasonable, around two years.