This phenomenon has been supported by the progressive financial liberalisation, the development of domestic financial markets, the greater use of domestic currency to facilitate bilateral trade activities and the development of the payments and settlement systems. The economic and financial regional integration has also been reinforced by a higher level of regional cooperation. Earlier regional cooperation had focused mainly on trade, investment and development. This decade has seen the cooperation shift to efforts to address financial stability issues, including in surveillance, crisis management, liquidity support arrangements, financial supervision and financial market development. The approach in forging greater financial integration in Asia will be different from that adopted by Europe. The region does not have centralised institutions to coordinate financial integration but has leveraged on the existing intra-regional groupings and networks to forge greater cooperation and collaboration in areas of common interest. The region has its own monetary and financial stability committee that is supported by arrangements for regional surveillance to identify risks and vulnerabilities to the region. Also in place is an integrated crisis management framework that will be operationalised in the event of an imminent financial crisis in the region. Recently the region successfully organised two schemes for reserve pooling, the Asian Bond Fund and the ASEAN+3 Chiang Mai Multilateralised Swap arrangement as a liquidity support facility.
It is in this context that the West was hit by oil shocks in 1973 and 1979 unleashing upward pressure on inflation and slowing real economic growth across major economies. Fast forward to 2020s, the pandemic and the war in Ukraine acted like two large supply shocks that put out of balance the global economy. Prices have gone up, and economic activity is slowing. Just like in the 1970s, the risk is that supply shocks spill over to the demand side, initiating a process that could push the world economy into a high inflation regime. Contrary to the 1970s, however, many central banks are more resolute than ever to pursue their mandate of price stability. Looking at the demand side, indicators of wage responsiveness are on the rise, but not to the extent that would fuel a wage/price cycle like in the 1970s. Indeed, despite a tight labour market, organised labour does not exert the influence it had fifty years ago: the  2/4  BIS - Central bankers' speeches  labour share of income has declined by around 15 percentage points from the mid1970s to 55%. A caveat on the labour supply. Today we still have to understand fully the make-up of our laboursupply post-COVID. Active ageing has still to come back to the 2019 levels, many young people are changing jobs more often, with some professions being shunned, people are taking time to decide what job they want to go for.