ContextWelcome speech at the first BIS Chapultepec Conference in Mexico City, gathering central bank governors of the Americas; the BIS serves central banks worldwide and faces a more uncertain region.
Why it mattersThe BIS head warns that doubts on public finances raise risk premia across the Americas.
Problems raised
Doubts on public finances raise risk premia and weaken currencies.
An abrupt repricing of public debt could threaten stability.
Banks and non-banks hold large amounts of public debt.
Solutions proposed
Consolidate fiscal positions.
Rationalise public spending.
Redirect resources to infrastructure and human capital.
