The unconventional volatility that has impacted the financial markets in recent weeks, which resulted in some notable increases in asset prices and many more harrowing shortcomings, will be with us for some time. Driven by a mix of tactical and structural forces, it is a sign of a continuous change in the markets’ operating climate.

And because of its potential for altering household and corporate behaviour, as well as the heightened risk of financial accidents, it amplifies the need to better manage downside risks to the global economy.

The emerging world’s spreading economic slowdown is eroding a fundamental underpinning of high and stable asset prices. Gone is the notion of a steady global growth “equilibrium”, albeit at a relatively low level, in which dynamic emerging economies offset the sluggishness in Europe and Japan.

Indeed, in virtually every systemically important emerging country (including Brazil, China, Russia and Turkey) growth is slowing; and, as highlighted by Mario Draghi, European Central Bank president, last Thursday, Europe is in no position to take up the slack — leaving too much of a burden on the US to act as a powerful global growth locomotive.