As regards the financial markets, we will continue to pay great attention to developments over the period to come. Turning to fiscal policy, the Governing Council is increasingly concerned about a weakening in structural fiscal consolidation efforts and the delaying of decisive action to address fiscal imbalances.
Meanwhile, China aside, the average large EM has experienced rising inflation and an expanding current account deficit, with monetary policy moving in the direction of tightening. The lesson is that EMs have not decoupled; instead, many of the biggest emerging markets have been contributing to global demand, using up policy space, and slowing for a lack of world growth.