##ntial instruments might not be needed in the direction of tightening, as domestic credit expansion will weaken. distinguished guests, i would like to underscore once more that as the central bank, our primary objective is to achieve and maintain price stability, and that as stipulated by article 4 of the cbrt law, we are responsible for “ taking precautions for enhancing the stability in the financial system and taking regulatory measures with respect to money and foreign exchange markets ”. therefore, we will continue to act with due diligence in terms of financial stability in the upcoming period as well. however, the central bank is not the only entity in charge of financial stability. other public authorities such as the ministry of finance, undersecretariat of treasury, capital markets board of turkey, and primarily the banking regulation and supervision agency, also have significant authority and policy instruments in this regard. it is essential that in the period we are going through, all policy instruments in hand should be deployed in a coordinated manner for the establishment of a sounder and more stable financial structure. to close my remarks, i would once again like to thank everyone who has contributed to the organization of this event.

##ra and not permitting households to use fx - denominated or fx - indexed loans encourage the private sector to borrow in turkish lira. the foreign exchange net general position arrangement for the banking sector and allowing the issuance of tl bonds by banks in a controlled manner can also be considered in this context. the fourth and last pillar of the policy framework is to promote the risk management concept. in this respect, steps to be taken regarding financial training assume importance for the smooth functioning of the system. we welcome the efforts towards increased recognition of turkish derivatives exchange, more diversified products and more widespread use of forward transactions. in addition, we believe that the floating exchange rate regime that has been in implementation since 2001 has significantly contributed to the embedding of awareness of exchange rate risk. in short, given the current conjuncture, the avoidance of excessive borrowing both by the public and private sector ; preference of longer maturities in all borrowings, opting to borrow in tl as much as possible and managing risks efficiently will considerably strengthen the resilience of turkish economy against external shocks. the monetary policy adopted by the central bank is composed in a way to make price stability and financial stability complementary. in this context, i would like to evaluate how the cbrt will use policy tools in the upcoming period within the framework of possible scenarios provided in the inflation reports. as also demonstrated on the slide, the current conjuncture supports the cbrt ’ s stance of keeping policy rates constant for some time, and at low levels for a long period. on the other hand, developments in the aggregate demand composition necessitated that instruments other than the policy rate be brought to pre - crisis levels. in this respect, we have largely completed the exit strategy measures that we announced in april 2010. in the october inflation report, we stated that our baseline scenario was based on an outlook where domestic demand is stronger compared to the previous reporting period, external demand continues to restrain economic activity, and thus aggregate demand conditions continue to support disinflation, albeit to a lesser degree. this baseline scenario assumes a policy framework that the measures outlined in our exit strategy are completed by the end of the year, and that policy rates are kept constant at current levels for some time followed by limited increases starting from the last quarter of 2011, with policy rates staying at single digits throughout the forecast horizon ( in other words, 3 years ). in this respect, noninterest instruments will be actively used in order to address the risks