The simplification will contribute to the effectiveness of the transmission mechanism by enabling a more reliable assessment of the monetary policy stance. In this context, we mostly achieved our targeted gains. We are planning to finalize the monetary policy simplification within a reasonable schedule. I also would like to add that the direction and timing of the next step towards simplification will depend on the developments affecting the inflation outlook and financial stability. As CBRT, our main funding has continued to be provided via one-week repo auctions, while the 2 / 10  BIS central bankers' speeches  share of our marginal funding decreased (Chart 4). Our weighted average funding rate dropped to around 7.8 percent in October. Interbank overnight repo rates remained on the decline in line with the reductions in the upper band of the interest rate corridor. I would like to underline that our monetary policy stance will continue to depend on the inflation outlook in the upcoming period. As CBRT, we will maintain our cautious monetary policy stance by taking into account the developments regarding inflation expectations, the pricing behavior and other factors affecting inflation. Amid continued expectations for a prolonged low interest rate environment across advanced economies as well as the favorable course of domestic macroeconomic indicators and monetary policy simplification, the yield curve shifted downwards in all maturities from the previous reporting period, as shown on the slide (Chart 5). The fall was more pronounced in short-term interest rates due to the decline in our funding rate.

Led by innovation across the globe from Bangladesh to Brazil, microfinance has allowed previously excluded segments of society to grow incomes, build assets and ultimately improve their standards of living. With poverty eradication taking centre stage in the global public policy agenda, such in the United Nation’s Millennium Development Goals, these developments are welcome. Here in Malaysia, microfinance has been an important part of the development agenda. In 2006, the Bank introduced a comprehensive microfinance institutional framework to promote the development of a sustainable microfinance industry. This facilitated greater access to financing by micro-entrepreneurs with no collateral, supported by simple application procedures, minimal documentation and quick turnaround times. The microfinance landscape in Malaysia has evolved from being Government-driven into one with vibrant private sector participation. At the turn of the century, total financing outstanding of the sector stood at USD35 million (RM151 million). Since then, it has multiplied by more than 30 times to USD1.2 billion (RM5.2 billion) in 2016, collectively benefitting more than a million micro enterprises. Despite significant strides taken since the 1970s to develop more inclusive financial systems, including in the countries represented here today, our work in microfinance is far from complete. The full potential of microfinance is not realised until we observe direct linkages to welfare improvements in the micro segment and ultimately, sustainable growth. At the same time, microfinance is also evolving in an era of unprecedented technological change. Adaptability is key for microfinance to thrive and further propel itself forward.