on the flip side, lower productivity means that goods and services will become relatively more expensive over time, which makes it more difficult to reduce inflation. finally, a significant part of the consumer price index ( cpi ) – the'basket'of goods and services that people buy, includes goods and services for which the prices are regulated by the government. these include ppv fares and utilities. in this regard, large and unpredictable regulated price adjustments complicate the job of the central bank in 1 / 4 bis - central bankers'speeches containing inflation. bank of jamaica remains committed to pursuing measures to improve the transmission mechanism to facilitate greater and quicker pass - through of policy rate adjustments in the banking system. the correspondence between the minister and the central bank on the inflation target has been published on the bank's website. i will now speak on the mpc's recent decision. monetary policy decision the bank's monetary policy committee ( mpc ) met on the 16th and the 17 th of may and announced the decision yesterday, to maintain : ( i ) the policy interest rate at 7. 0 per cent ; ( ii ) relative stability in the foreign exchange market ; and ( iii ) tight jamaican dollar liquidity conditions. this decision reflects the committee's view that while inflation is continuing its downward trend, it is still not yet firmly anchored within the target range and the risks to future inflation are skewed to the upside. statin reported on wednesday last week that jamaica's annual headline inflation rate at april 2024 was 5. 3 per cent, which is within the bank's target range and lower than the rate recorded at march 2024. the bank is encouraged by this outturn which represented the third consecutive month of lower inflation and the second consecutive month in which annual inflation was within the target range. the april 2024 outturn was also lower than the bank's most recent forecast, mainly due to a faster than projected deceleration in agricultural food inflation. core inflation, which excludes food and fuel prices from the consumer price index, was 5. 7 per cent and although elevated, it was marginally lower than the outturn recorded in march 2024. some of the key drivers of headline inflation, such as international grain prices and inflation expectations continued to decline. inflation in the economies of jamaica's main trading partners has also continued to moderate. however, international oil prices have been volatile. despite the encouraging outturns at march and april, the declining inflation is

banking and financial system. a strong and healthy financial system is critical for the growth and development of any country. throughout the long history of financial markets, there have been a number of banking and financial crises that have severely disrupted economies. there is no reason for us to believe that there will be an end to these disruptions in an era of continuing technological change and innovation. what is therefore important is that we continually seek to prevent and mitigate future crises. this we can do with a blend of sharp analysis, keen judgment, practical experience and a rigorous understanding of the workings of financial markets in both normal and abnormal times. i believe that this is what defines effective banking supervision. it is also this rigorous understanding of the operations of financial markets that is of critical importance to the development of macroeconomic policy inclusive of monetary policy. mr. chairman, over two and a half centuries ago, in the 18th century to be exact, adam smith wrote of the free - market system as the “ invisible ” hand that guides the market to achieve the public good. while that concept has today still not lost its resonance, the increase in the complexity of economic and financial affairs and the potential for instability that this has fostered, has placed us in a new arena. an arena, whose sphere of influence is constantly changing and one that therefore requires close and integrated monitoring in order for us to understand and manage the risks that abound. the banking crises of the last quarter of a century and particularly those of the last ten years have had a damaging impact on economic activity and the repercussions have been devastating for a number of economies. there is therefore no room for countries in our region to be less than aggressive in ensuring a more careful, integrated and direct oversight of the financial system to complement at least, that “ invisible hand ” of which adam smith wrote. this is of course, what asba is trying to achieve. i use the word integrated because in some of our jurisdictions, jamaica for example, supervision is divided among institutions. in the jamaican case we have over the years reduced the number of supervisory authorities in the financial sector to two. this has achieved positive results in terms of the efficiency of supervision. it is my view that we could achieve an even greater level of effectiveness by going one step further with the establishment of a single supervisory authority for the financial system as a whole. i also believe that there are significant advantages to be derived from the integrated interplay between the roles of supervision and the effort to achieve financial