This finding could be due to the wildebeest’s superior ability to detect predators, as they may have better – and complementary – senses of smell and hearing.12 In a similar vein, developments in the financial system can provide central banks with valuable information. In general, there is ample evidence that financial conditions do contain information about future economic activity.
I would hope these plans provide clarity to a board or senior management in terms of where the Central Bank is coming from and can be part of a “no surprises” approach. Thirdly, the PRISM framework includes an important role for risk governance panels.