the services sectors both follow more stable patterns than they did a few decades ago. a second explanation offered for cyclical damping is that ict developments have led to improved inventory management efficiency. ict applications have enabled businesses to organise their inventory management in more efficient ways. but ict applications have not helped predict the future development of consumers ’ inclination to spend. if consumers spend 100 million euro less than expected on their christmas shopping, stocks increase by 100 million euro ’ s worth. in other words : greater or smaller - than - expected sales affect inventories just as much as they did ten years ago. therefore, the observed damping of the business cycle must be attributable to other causes. a third explanation given for the flattening of cyclical patterns is that monetary and budgetary policies nowadays tend to be aimed more towards the medium term. over the past two decades, monetary policy has succeeded reasonably well in curbing inflation, thereby enhancing the predictability of the macroeconomic environment. the risk that a cyclical boom will trigger a wage - price spiral has also diminished. as for budgetary policy, the 1960s and ’ 70s were characterised by activism, which served to magnify rather than damp cyclical movements. the 1980s were the years of austerity measures, taking away the potential stabilising effects of public finance. since then, the budgetary position of the netherlands - and of some other countries - has greatly improved, allowing a trend - based budgetary policy to be pursued. such a policy implies that in principle, public finance has a damping effect on the business cycle. in the meantime, however, developments in the us show that active budgetary policy is not yet entirely a thing of the past. the us budgetary position ( as a percentage of gross domestic product ) has deteriorated by 4½ percentage points in just two years ’ time. a fourth factor connected with cyclical damping is the fact that fewer global shocks have occurred during the last twenty years. so damping is also a matter of chance. the 1990 - 91 recession in the us, for instance, was mitigated somewhat by the boost which the european economy received from german reunification and which kept up the level of us exports to europe. a few years later, the reverse happened. despite the multitude of possible causes, only 40 % to 60 % of the damping effect can be explained. the latter two factors - less activist budgetary policies and fewer global shocks - each account for 20 % to

muhammad bin ibrahim : development and deployment of malaysia ’ s atm network speech by mr muhammad bin ibrahim, deputy governor of the central bank of malaysia, at the launch of meps ( malaysian electronic payment system ) atm initiative, kuala lumpur, 21 october 2013. * * * pooling of resources through meps the launching of meps ’ atms marks an important milestone as this will be the first time that meps, a non - bank entity owned by the banking industry, is deploying atms, instead of by individual banks. this initiative is indeed a welcomed move as it facilitates the pooling of resources by the banking industry for a common objective of developing and deploying industry - wide banking infrastructure. it promotes efficiency and cost effectiveness. widening the atm network through shared resources will also benefit the public by having more convenient points of access to banking products and services. meps had in the past a history of coordinating industry - wide infrastructure development efforts. an outstanding achievement was made when it coordinated the industry - wide migration of the atm cards from magnetic stripe to chip - based technology in 2001 to eradicate the numerous fraud involving magnetic stripe technology. this move was a significant strategy for the country, as malaysia was amongst the first, to adopt a chip - based technology to reduce fraud and boost public confidence in the use of the atm and payment cards. meps should continue to perform this role, as builder of payment infrastructure for the banking industry. as an industry, banking institutions should continue to share infrastructure cost and compete on providing quality products and services. basic payment infrastructure should not be a tool for competitive edge but rather as a means to reduce cost and adopting common standards. migration to e - payments to achieve cost savings accelerating the migration to e - payments is one of the key strategies in the financial sector blueprint. on numerous occasions we had highlighted that a successful migration has the potential to drive further efficiency gains and cost savings. it will improve the country ’ s competitive position. research has suggested that successful migration to e - payments can save the country in terms of costs ( of about 1 % of gdp annually ). today, cheques and cash remain prevalent in malaysia. based on the last 3 years data, an average of 205 million cheques totalling to about rm2 trillion were issued on an annual basis. our preliminary estimates showed that at rm2. 70 cost per unit, the banking industry spends at least rm544 million annually on extending cheques issuing services. this is an expensive way of