expanded to corporate bonds at a later stage. initially in the electronic trading platform, primary dealers will be the only “ price makers ” while the rest of the market will be “ price takers ” but with full access to trading and pricing information. in addition to the general benefits of enhanced market transparency, credit risk management and trading, the electronic trading platform also aims to improve liquidity by expanding this platform to include other market participants complying with the requirements as market makers, in addition to the primary dealers. competition among market makers is paramount to supporting liquidity at an instrument level and to minimising transaction cost. the introduction of the electronic trading platform will enable national treasury and the south african reserve bank to monitor market - making activities in the secondary bond market, which could result in the enhanced monitoring of liquidity conditions. enhancements to over - the - counter trading in response to the recommendations of the g - 20 and the subsequent principles for financial market infrastructures, the south african central securities depository, known as strate, is in the process of addressing the lack of transparency and risk management in over - the - counter ( or otc ) instruments. to address these concerns, the financial markets act was promulgated and regulation was passed to include the clearing through a central counter party and to record all the financial transactions of otc derivatives contracts in a trade repository. collateral optimisation in collateral markets, “ collateral optimisation ” has become a key objective. not only do banks invest in systems that optimise the way in which their collateral can be utilised, but vendors and central securities depositories now also provide these services to their clients. these smart systems have built - in intelligence which optimises the way in which the collateral is applied and will substitute assets if required. an example is the clearstream collateral management system, which is gaining momentum globally. the speed of transactions the need for faster services, trading, transactions and payments is stimulated by a generation demanding access and speed, accommodated by the proliferation of new technologies, growing familiarity with technology, and expectations of real - time satisfaction if not gratification – not only in financial market transactions and payments, but also in communication, services, social media and entertainment. participants in financial markets have created systems which enable the “ trawling ” of financial markets to detect opportunities within markets and then to transact on these opportunities within milliseconds – also termed “ high - frequency trading ”. not only do these transactions take

. an important element in the growth outlook is macroeconomic stability, which is where monetary policy makes its contribution. 4. the role of monetary policy the mandate of the bank is to achieve low inflation in the interest of sustainable economic growth and development. a low inflation environment contributes to growth and development by providing a more certain basis for investment decisions in the economy, and lowering overall risk. the inflation - targeting framework adopted in february 2000 has contributed to the reduction of inflation to low levels. for the past 32 months, cpix inflation ( i. e. headline inflation excluding mortgage interest cost ) has remained within the target range of 3 - 6 per cent, despite strong output and expenditure growth in the economy, and significantly higher international oil prices. furthermore, there is evidence that inflation expectations have become entrenched at levels consistent with the target. these developments have allowed for nominal interest rates to fall to levels last seen in the late 1970s. between june 2003 and april 2005, the repo rate was reduced by a total of 650 basis points, although at the most recent monetary policy committee meeting earlier this month, the repo rate was raised by 50 basis points to 7, 5 per cent per annum. real interest rates have also come down somewhat and have become less variable. the recent repo rate increase, the first since september 2002, was motivated by the deteriorating risks to the inflation outlook. apart from adverse oil price developments, the concerns of the committee also centred around the continuing high levels of consumer demand, which have been reflected in rising levels of credit extension to the private sector and also the larger - than - usual current account deficit on / of the balance of payments. twelve - month growth in bank loans and advances extended to the private sector measured 23, 1 per cent in april compared to 24, 3 per cent in march, while asset - backed credit extended to the private sector continued to grow strongly at a year - on - year rate of 27, 2 per cent in april. although there were few signs of inflationary consequences at that stage, the impact was being felt in the deficit on the current account of the balance of payments which had expanded to 6, 4 per cent of gdp by the first quarter of this year. as we observed in our latest monetary policy review, current account deficits are a reflection of higher domestic expenditure and are not in themselves inflationary. there is however a possible risk to the exchange rate if the deficits are perceived to be unsustainable, particularly if the