At this point, a financial regulatory reform was necessary at international level, to address such risks. Under the guidance of the G20, broader and more comprehensive regulatory reforms were designed, with a special contribution by Basel Committee, the Financial Stability Board, IMF/WB group and many other. Such reforms were aiming to: •  strengthen the resilience of the financial system;  •  avoid future similar crisis;  In more details, such reforms included: •  Improving the surveillance superstructure of the financial system, through:  –  establishing institutions with macro-prudential powers to monitor, assess and address systemic risk (in EU – ESRB, ECB; in US – FSOC; in UK – FPC; etc.
Inflation and Supply-Chain Challenges One of the foremost concerns surrounding the outlook is inflation, which rose considerably last year. There are two main contributors to the current high inflation: very strong demand, especially for goods, and supply bottlenecks. Both have been prevalent throughout the pandemic. The shutdown of factories—particularly those in Asia—and widespread lockdowns led to disruptions to logistics networks, elevated shipping costs, and prolonged delivery times. A new index created by New York Fed research staff shows that global supply-chain pressures shot up last year, reaching historically high levels.1 These challenges are not just top of mind for companies selling their goods or consumers waiting for their purchases to be delivered. Elevated prices have real life consequences for so many, particularly for people who are struggling to cover the rising costs of food, housing, and transportation. The circumstances we are facing today are unlike anything we’ve experienced in the past. 2/3  BIS central bankers' speeches  Typical historical episodes cannot be used as reference points for current conditions. As an example, the very large increases in prices that we see today are primarily for durable goods. This is a striking turnaround from the past 25 years when those prices had been trending lower. In contrast, even with the recent increases, prices on services and non-durable goods are now fairly close to their longer-run trends. And, even though the Omicron wave is posing new obstacles, some supply issues are starting to work themselves out as the economy adjusts to the changing circumstances.