To restore investors’ confidence, they should address  BIS central bankers’ speeches  5  domestic vulnerabilities. This might also help to bring down the exchange rate of the euro, as part of its increase was due to capital being reallocated from emerging markets to the euro area.
Although the turbulence in emerging markets does not have the potential to derail the global recovery it shows how sensitive markets are at the moment. There is still considerable scope for negative confidence shocks. Returning to economic prosperity and financial stability requires policy-makers with a stability-oriented mind set – something I do not have to emphasise here at the “Bundesbank of the United States”.