Policy makers need to work with rather than against the grain of markets by continuing to enable financial innovations. They should, however, be vigilant for any signs of disorderly global rebalancing. Looking ahead, entrenching financial stability into the future would depend upon bolstering market confidence.
In the overall assessment, the adverse consequences of the US sub prime turmoil could weigh heavily on the future stability of financial markets and have the potential to have a wider impact on global growth with particular concerns centred on the prospects for EMEs.