Figure 2 CPI monthly inflation (percentage) 2.0 1.5 1.0 0.5 0.0 -0.5 -1.0 -1.5  Jan.  Feb.  Mar. Apr. 2001-2006 Average  May  Jun. 2007  Jul. Aug. 2008  Sep.  Oct.  Nov.  Dec.  2009  Source: National Statistics Bureau (INE). 6  BIS Review 145/2009  Figure 3  Accumulated CPI variation by country  (percentage)  Japan  0  South Africa Turkey Chile Indonesia  Colombia Hungary Peru Brazil Czech Rep. Malaysia Israel Mexico South Korea Norway USA Thailand Poland UK Sweden Eurozone Switzerland Canada Hong Kong  5  10  USA Eurozone Hong Kong Switzerland Malaysia Chile Japan  15  20  (a) Between January 2007 and October 2008. -4  -2  South Africa Hungary Mexico Brazil Poland Colombia Israel Turkey Indonesia South Korea Sweden UK Norway Peru Thailand Canada Czech Rep.  0  2  4  6  (b) Between October 2008 and September 2009 (*)  (*) For Hong Kong, Japan, Malaysia and South Africa, data at August 2009. Sources: Statistics bureaus of each country and Bloomberg. Figure 4 World growth forecasts (annual change, percentage) 4  3.0  3  2.5  2  2.0  1  1.5  0  1.0  -1  0.5  -2 -3  0.0 08  May  Sep.  09  May  (a) Forecasts for 2009  Sep.  09  Mar. May  Jul. Sep.  (b) Forecasts for 2010  Source: Consensus Forecasts.
Today, many of the ASEAN-5 countries have fairly deep and liquid local bond markets. Central banks, whose operation is contingent on a deep and liquid bond and foreign exchange markets, have been part of the development process for the government bond market. Over the years, our financial markets have become more efficient, more sophisticated and more balanced. ASEAN-5 have moved from a predominantly bank-based or credit market to a growing capital market, both equity and bond. We have also strived to better manage the impact from volatile capital flows as we seek to balance between foreign inflows and capital outflow. Here bond markets have been instrumental to help absorb the impact from the volatilities and sudden reversal of these flows. These developments have facilitated central banks in their conduct of monetary policy, manage market expectations, and guide the path of monetary policy. Today, the ABMI is taking this development further from a domestic orientation to a regional level. This is timely in view of the increasing need for Asians to find new sources for growth and new markets for their exports, and in recognition of the need for “Asian savings to finance Asian investment”. Initiatives such as the Credit Guarantee and Investment Facility (CGIF) is a case in point that aims to foster cross border fund mobilization using the tools of a regional credit guarantee vehicle.