has grown from USD 640 billion a day in 1989 (the earliest year for which comprehensive data is available) to about USD 4 trillion a day in 2010. From a hesitant beginning in 1970’s, securitized assets outstanding today are estimated to exceed USD 15 trillion. Interest rate derivatives market, which has a shorter history, had outstanding contracts exceeding USD 500 trillion at end 2011.
This underscores the importance of a well-capitalised and tightly-supervised financial system, a precondition for stable prices which monetary policy cannot establish, and which is the responsibility of other policy makers instead. The contribution of monetary policy is by seeking, through conducting a more symmetric monetary policy, to prevent financial turbulence, which could pose a threat to price stability.