The BIS Quarterly Review for March 2011 discusses how expectations of higher growth in the advanced economies and surging commodity prices pushed up short-term inflation expectations. The March issue also provides highlights from the latest BIS data on international banking and financial activity. In addition, it features four articles: 1. Systemic importance: bank size is a simple yet reliable indicator of systemic importance. A bank's total interbank lending and borrowing provide useful complementary information. 2. Inflation expectations and the great recession: short-run inflation expectations have rebounded after dropping in the crisis. Measures of long-run inflation expectations suggest that investors continue to perceive central banks as credible for the time being, but their somewhat higher dispersion raises questions about how firmly expectations are anchored. 3. The use of reserve requirements as a policy instrument in Latin America: changes in reserve requirements have helped several Latin American central banks to achieve their monetary policy and financial stability objectives in recent years, although not without costs. 4. Foreign exchange trading in emerging market currencies: as income per capita rises, foreign exchange trading cuts loose from underlying current account transactions and takes place increasingly outside the home country.[...]