2  BIS central bankers’ speeches  than 2 percentage points higher than actual capital levels at the end of 2008.4 Higher capital puts these firms in a much better position to absorb future losses while continuing to fulfill their vital role in the economy.
This warrants close monitoring, in particular given the risks of second round effects. In case of food related commodities, it also underlines the importance of efficient supply side adjustment in agricultural commodity markets. A separate but nonetheless potentially equally important channel through which globalisation can affect inflation involves the indirect price impact of increased competitive pressures, with two main aspects.