3  New currencies have sometimes been introduced by executive decision and in an orderly way. The most obvious example is the euro. But when currency substitution has occurred naturally it’s almost always done so only after the incumbent currency has been debauched by hyperinflation. 4  Walport (2016). 5  Autonomous Research (2016). BIS central bankers’ speeches  3  Central bank digital currency: who can bank at the central bank? What, then, of the exchange of money, the particular asset for which the distributed ledger technology was originally conceived? Well that too has its own layers. Broadly speaking, at least for a given currency, there are two: commercial banks and the central bank. As we saw in Chart 1, most of what you and I consider money is held as liquid claims on commercial banks, i.e. deposits. Most transactions in the economy involve transfers of these claims. That’s obviously a straightforward matter if the two parties to the transaction use the same bank. When there are different banks involved – and that’s going to be true most of the time – there needs to be a means by which one can transfer money to the other. This is done using their deposits at the central bank – so-called “reserves”6. That’s why the central bank is sometimes called “the banker’s bank”, and why reserves are often described as “the ultimate settlement asset”.
Moreover, in line with the MTP, it is envisaged that the rising debt-to-GDP ratios will reverse their course steadily starting from 2011, and hence the risk premium would not display any significant changes throughout the forecast horizon. BIS Review 143/2009  15  Table 1: Annual Growth Forecasts 2009  2010  Previous Forecast  New Forecast  Previous Forecast  New Forecast  World  -1,4  -1,1  2,5  3,1  Developed Economies  -3,8  -3,4  0,6  1,3  United States  -2,6  -2,7  0,8  1,5  Euro Area  -4,8  -4,2  -0,3  0,3  Developing Countries  1,5  1,7  4,7  5,1  All OECD  -4,1  -3,7  0,7  -  United States  -2,8  -2,8  0,9  -  Euro Area  -4,8  -3,9  0,0  -  World  -2,3  -2,3  2,6  2,7  United States  -2,6  -2,5  2,4  2,6  Euro Area  -4,4  -3,9  1,0  1,1  IMF  OECD  Consensus Economics*  Source: IMF World Economic Outlook, July and IMF World Economic Outlook Update, October. OECD Economic Outlook, June and OECD Economic Outlook, September. *Consensus Forecasts, September and October.