Moreover, the rise in long-term interest rates and the appreciation of the yen against the U.S. dollar since the end of last year had added to the downside risk to the economy. There was concern that, if these trends continued, the economic deterioration would not come to a halt, possibly accelerating once again in the future.
We faced an unprecedented economic crisis but we did not see the banking system amplify the economic disruption.1 So the first lesson is we must now focus on taking these frameworks from adolescence to maturity. Another key lesson is the need to develop and operationalise a macroprudential framework for market-based finance.