At the same time, however, the combination of low interest rates and low volatility in financial markets is of concern to the extent that it can lead to excessive risk-taking via a search for yield. This is something that the Reserve Bank has been noting for a time.9 Is there evidence of excessive risk-taking in fixed income markets? It’s hard to say.
Of course, this is even more so if its own currency is a reserve currency which foreign central banks are willing to accumulate. Current account surpluses and lending I would now like to approach the subject of imbalances from the side of the surplus countries, particularly Asian countries.