- An Evidence-based Analysis of the Trade Effects of the Euro”, Centre for Economic Policy Research. Baldwin, R., Skudelny, F. and Taglioni, D., (2005), “Trade effects from the euro – evidence from sectoral data”, ECB Working Paper Series, No. 446. Boije, R., Borg, A. and Eklund, J., (2002), ”The Riksbank’s statement regarding the report ’Stabilisation in the monetary union’”, Sveriges Riksbank Economic Review, 2002:4, pp. 90-127. Boije, R. and Shahnazarian, H., (2003), “National Stabilisation Policy for Sweden in Stage Three of EMU”, Sveriges Riksbank Economic Review, 2003:1, pp. 18-49. Borio, C. and Filardo, A., (2006), “Globalisation and Inflation: New Cross-country Evidence on the Global Determinants of Inflation”, Mimeo, BIS, Basle. Böwer, U. and Guillemineau, C., (2006), “Determinants of Business Cycle Synchronisation Across Euro Area Countries”, ECB Working Paper Series, No. 587. Kose, M. A., Otrok, C. and Whiteman, C. H., (2005), “Understanding the Evolution of World Business Cycles”, IMF Working Paper, No. 05/211. Lamfalussy, A., (2006), ”Central banks, governments and the European monetary unification process”, BIS Working Paper, No 201, BIS, Basle. Mishkin, F. and Schmidt-Hebbel, K., (2006), “Does Inflation Targeting Make a Difference?”, Mimeo, presented at Bank of England. Mundell, R., (1961), “A Theory of Optimum Currency Areas”, American Economic Review, Vol. 51, No. 4., pp. 657-665. Persson, T., (2001), “Currency Unions and Trade: How Large is the Treatment Effect?”, Economic Policy, October, 0(33), pp. 433-48. Rose, A. and Stanley, T. D., (2005), “A Meta-Analysis of the Effect of Common Currencies on International Trade”, Journal of Economic Surveys, Vol. 19, pp. 347-365.
Having said this, there is a sense of comfort that the capital base of banks in this region remains relatively sound. But going forward, banks, regulators, and central banks would benefit from undergoing stress-test and crisis management exercise to assess their strategy and make necessary adjustment to their risk management and capital policy. The close dialogue forged by such an exercise will be very useful in helping to instigate coordinated actions including information sharing. In terms of financial stability surveillance, candid on-going dialogue and market communication between key stakeholders is at the heart of an early identification of emerging trends and risk in the system. We all know that most indicators, risk models, and early warning models are built based on the structure of the past crisis, but no two crises are identical. For the Thai banks, you are already familiar with the stress-test, both top-down and  BIS Review 135/2008  3  bottom-up, that has started last year when we successfully completed the assessment of the Financial Sector Assessment Programme of the IMF and the World Bank, or the FSAP. Ladies and Gentlemen, The present global financial crisis highlights the importance of supervisory coordination. While this has been especially critical for crisis management in affected countries, a step-up in coordination would also be critical for currently unaffected countries as well. Importantly, this coordination should include both domestic and cross-border dimensions.