With such caracteristics of climate-related risks, climate « stress test » as well as climate « scenario analysis », can prove to be very useful tools for financial institutions and their supervisors, to examine and understand the effects of different pathways for climate  change, as well as the effects of different pathways for climate policy, technology and consumer and investor preferences. It can prove also useful to reflect on and examine the impact of management decisions. It is with those mainly qualitative objectives in mind that, at the ACPR and the Banque de France, we have conducted with the French insurance and banking industry our first scenario analysis, which was completed and published a few weeks ago. I must say that those qualitative objectives have been well met, from our perspective. In particular, the exercise has clearly incentivised the participants to reflect on and develop appropriate tools and methodological frameworks to incorporate climate-related risks as a  mainstream risk to be governed and managed on a day to day basis accordingly, in line with our supervisory expectations. Given the difficulties to assess the exposure to and the impact of climate-related risk we have not assigned to this exercise quantitative objectives, beyond providing participants and us with a first bottom up assessment of their exposure, based on common assumptions, assessment which appears to be moderate by 2050.
 Inflation is high, but will fall towards the 2% target over the coming years. BIS Review 100/2008  7  Outline  International developments  Developments in Sweden  M onetary policy  What has happened during the summer  Basis spread Difference between interbank rates and expected policy rates Basis points 120  100  120 M PR 2008:2  Sweden USA Euro area  100  80  80  60  60  40  40  20  20  0 jan-07  0 apr-07  jul-07  okt-07  jan-08  apr-08  jul-08  Sources: Reuters EcoWin and the Riksbank  8  BIS Review 100/2008  GDP growth in the USA Quarterly changes in per cent calculated at an annual rate, seasonally-adjusted data 8  8  6  6  4  4  2  2  0  0  -2  -2 00  01  02  03  04  05  06  07  08  09  10  11  Note. Broken columns represent the Riksbank’s forecasts in M PR 2008:2. The dot is the outcome for Q2 2008.