How to moderate excessive swings in risk premia across financial markets that risk damaging the financial system is the "next frontier for macro-prudential policy," the Bank of England's executive director for financial stability Andrew Haldane said today in a speech in London.

Noting that macro-prudential policy to date has been focusing on the risks arising from leverage on the balance sheet of banks – the quantity of risk – Haldane argued that if risk in the financial system is "shaped