It’s based in Switzerland. I supported the extraordinary monetary policy activities of the U.S. With this heart, the BIS creates: Decisive action by central banks during the global financial crisis was probably crucial in preventing a do it again of the encounters of the fantastic Depression. However, since there is widespread contract that aggressive monetary easing in the primary advanced economies was important to prevent a financial meltdown, the advantages of prolonged easy monetary conditions are more questionable. First, extended unusually accommodative financial conditions mask underlying balance sheet problems and reduce bonuses to address them head-on. And low rates of interest reduce the opportunity cost of having non-performing loans and could lead banks to overestimate repayment capacity.

All this may perpetuate weakened balance bed linens and lead to a misallocation of credit. Third, low short- and long-term interest rates might create risks of renewed excessive risk-taking. However, low interest rates can over time foster the build-up of financial vulnerabilities by triggering a search for yield in unwelcome segments. There is certainly ample empirical evidence that this route performed an important role in the run-up to the financial crisis. Recent large trading losses by some finance institutions may reveal pockets of extreme risk-taking and require scrutiny. The prevailing loose global monetary conditions have been fuelling credit and asset price booms in a few emerging market economies for a long time now.

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This creates dangers of rising financial imbalances comparable to those observed in advanced economies in the years immediately preceding the turmoil. Their unwinding could have significant negative repercussions, also globally because of this of the increased weight of rising market economies in the world economy and in investment portfolios. In the primary advanced economies, if the economy remains root and weak solvency and structural problems stay unresolved, central banks will come under growing pressure to do more. A vicious circle can develop, with a widening gap between what central banks are expected to deliver and what they can actually deliver. This might make the eventual leave from financial accommodation harder and may eventually threaten central banks’ reliability. This concern is reinforced by growing politics economy dangers.

And we look forward to continuing to aid China’s growth and economic success. Our business operations in China continue as normal, Manus. And we are confident about our China business, and we don’t comment on speculation. We’ll take our next question from Alastair Ryan from Bank or investment company of America. Another question for the Chairman, really.

Thank you. I think in our view, that’s not a risk. Noel has been given full authority to take things forward in a manner that allow him the flexibility to make the decisions that he and the executive team view as the best for the business. Etc that basis, there must be no risk that there surely is going to be any hiatus period. I think we will get stayed in, and Noel realizes that this — we have to move with speed, ambition and decisiveness. Our next question comes from Raul Sinha of JPMorgan.

I hope you don’t mind if I ask 3. The first one, I was wondering if you could comment a little bit on Hong Kong in conditions of the outlook for the second half. And in addition, your July performance, if there’s anything there. It generally does not seem like there’s anything in the numbers itself that would prompt it, but it might be useful to get a comment along those relative lines. The second you are on the RoTE and the decision to continue to target above 11% in 2020. Obviously, as you know, consensus is around 10% in the first half of the year.

If you take the gains out, you’re obviously well below the 11% on my figures, and obviously, you’re flagging a difficult second half. The third one, more for Ewen maybe. Actually, on the Basel III reform, I mean you are actually quite different from your peers in the sense that we don’t actually get any indication about the potential RWA inflation for HSBC. And I was wondering if you might be able to put a range, at least, in terms of how much we can get.

Yes. So look, on Hong Kong, as you’ve observed, you do not really see it in any way in the first half numbers. Numbers were good. Second quarter was good. Revenues were up significantly. Profits significantly were up. Yes, until we expect some impact in the next half, yes, inevitably, it will be. If the existing situation continues for a prolonged period of time, it shall impact confidence.