Reserve management challenges in the current economic and financial environment

Speech by Mr Agustín Carstens, General Manager of the BIS, at the High-Level Reserve Management Conference, Hanoi, Vietnam, 21 September 2023.

Reserve management has always been an important aspect of central bank operations. But the role of foreign exchange reserve managers has changed over time as monetary policy frameworks have evolved, with many central banks now deploying their reserves in a more agile manner to support their macro-financial objectives. To operate successfully, reserve managers need to balance a range of considerations, including safety, liquidity and earning an appropriate return on their investments. Meanwhile, sustainability has emerged as a fourth reserve management objective for many central banks, giving rise to yet another challenge. The BIS stands ready to assist central banks with their reserve management objectives by offering safe, highly liquid products that offer a favourable risk-return trade-off, as well as a number of sustainable product offerings.