In some sense, as the era of low policy rates and quantitative easing seems to be drawing to a close, we are entering new and unchartered territory. While the landscape in front of us appears ever-changing, complexities continue to abound. As such, opportunities to engage with peers – opportunities such as this forum – are proving to be invaluable.
In particular, the quarterly assessment of financial stability is a critical input into the Board’s processes for adjusting the supervisory scenarios used in the stress test and the setting of the countercyclical capital buffer—the two tools that permit the Board to respond to vulnerabilities that build over time.