It is now more than ever important and necessary that Europe responds cohesively and decisively to the challenges it is facing.
Our reserves comprise essentially borrowed resources, and we are therefore more vulnerable to sudden stops and reversals as compared with countries with current account surpluses. In recent months, when inflows have swamped most EMEs, several central banks have intervened in the forex markets. We haven’t despite receiving more portfolio inflows last month (September 2010) than in any other single month on record.