ensuring stability in financial markets through an ample provision of funds ; and ( 3 ) active purchases of assets such as etfs. these measures have had positive effects, coupled with the government ’ s responses and active efforts by financial institutions. global financial markets are still nervous, but tension has eased. although firms ’ financial positions have been weak, the environment for external funding, such as the issuance of cp and corporate bonds as well as bank borrowing, has remained accommodative. that said, there are high uncertainties over the outlook for economic activity and prices, and the bank recognizes that risks are skewed to the downside. as the spread of covid - 19 has not 1 / 2 bis central bankers'speeches subsided globally, the consequences of covid - 19 and the magnitude of their impact on domestic and overseas economies are highly unclear. in addition, the outlook is based on the premises that, while the impact of covid - 19 remains, growth expectations will not decline substantially and financial system stability will be maintained, but these premises also entail uncertainties. moreover, with regard to risks to the financial side from a somewhat long - term perspective, prolonged downward pressure on financial institutions ’ profits might lead to a gradual pullback in financial intermediation, given the existing factors — such as the prolonged low interest rate environment and the declining population — as well as the recent impact of covid - 19. on the other hand, under these circumstances, the vulnerability of the financial system could increase, mainly due to the search for yield behavior. these risks are judged as not significant at this point, mainly because financial institutions have sufficient capital bases. however, it is necessary to pay close attention to future developments. based on such recognition, the bank will continue to firmly conduct the current monetary easing measures and to support financing, mainly of firms, and maintain stability in financial markets. in addition, for the time being, it will closely monitor the impact of covid - 19 and will not hesitate to take additional easing measures if necessary. thank you. 2 / 2 bis central bankers'speeches

others that rely mostly on only one type of the financial markets. indeed, banks and capital markets are complements, and not substitutes. for some industries at certain times of their development, capital market - based financing is advantageous. for example, financing through stock markets is optimal for industries where there are continuous technological advances and where there is little consensus on how firms should be valued or managed. the stock market checks whether the manager's view of the firm's production is a sensible one. for other industries, bank - based financing is preferable. this holds in particular for industries which face strong information asymmetries. financing through financial intermediaries is an effective solution to adverse selection and moral hazard problems that exist between lenders and borrowers. furthermore, efficient and well - balanced financial system will allow the system to better manage and absorb shocks as the market would be less prone to one - way market conditions and possesses greater liquidity. the experience of the asian crisis, for example, points to the critical importance of the development of long - term local currency debt market, to increase the depth and the breadth of financial market. in addition, the lack of diversified structure and market may lead to increased risk from concentration of credit and maturity risks in the banking system. lack of markets may lead to the mispricing of risk and excessive delay in correcting large exposures, as well as increased vulnerabilities from capital inflows. ladies and gentlemen, the interaction between financial markets, economic growth and monetary policy is by no means a new issue for central bankers. indeed, the continued deepening of capital markets is a significant issue for policymakers, and particularly for central bankers, since smooth functioning and efficient financial markets are crucial in ensuring an effective transmission of monetary mechanism. the best contribution that monetary policy can make to thailand ’ s capital market development and its economic growth is to maintain steady medium - term price stability. such a policy is beneficial, as it will minimize the adverse effects of inflation and high inflation uncertainty. as we all know, price stability brings numerous benefits. it not only creates a climate for higher economic and investment activities, but also reduces the economic and social inequalities caused by the asymmetric distribution of the costs of inflation among the various economic agents. in addition, in an environment of low inflationary expectations, inflation risk premia become relatively less important as a determinant of financial prices. as a result, other factors such as credit risk can