- rate corridor and the tight liquidity policy we have been implementing played a major role in shielding the economy against global shocks. moreover, our structural and cyclical measures supporting fx liquidity, core liabilities and long - term borrowing strengthened the economy ’ s resilience. 1. monetary policy and financial conditions in view of the uncertainty over global markets and the volatility in food and energy prices, we maintained a cautious monetary stance in the second quarter of 2015. in this period, we kept interest rates unchanged, but continued with the tight liquidity policy to contain risks to core inflation and inflation expectations. to meet the recently growing liquidity need, the weight of marginal funding was increased and, as a result, the cbrt average funding rate increased ( chart 3 ). the cbrt average funding rate has been hovering around 8. 5 percent since midjune ( chart 4 ). the bist interbank overnight rate, on the other hand, remained close to the upper bound of the corridor as in the previous reporting period. bis central bankers ’ speeches thanks to the cautious monetary stance, the yield curve remained nearly flat. although the yield curve has remained basically unchanged since the publication of the previous inflation report, there was a slight increase in the market rates with more than two - year maturity ( chart 5 ). thus, the spread between the overnight repo rates at the bist interbank money market and 5 - year market rates has narrowed somewhat ( chart 6 ). i would like to reiterate that we will monitor inflation expectations, pricing behavior and other factors that affect inflation closely and maintain the cautious monetary policy stance by keeping a flat yield curve until there is a significant improvement in the inflation outlook in the upcoming period. the wide interest rate corridor and the tight liquidity policy that we have been implementing reduce the economy ’ s sensitivity to global shocks, thus supporting financial stability and facilitating the attainment of the price stability objective. in the post - crisis period, the unconventional policies of advanced economies and the ongoing uncertainties over global monetary policies caused long - term interest rates in these economies to fluctuate. in addition, emerging - market rates have become extremely sensitive to global monetary policy developments. to contain repercussions on the turkish economy, we designed a monetary policy framework composed of a wide interest rate corridor and an active liquidity policy. the cbrt ’ s wide interest rate corridor and the tight liquidity policy strengthened the resilience of the turkish economy against global shocks

addition to the flexible monetary policy strategy implemented by the central bank as of the end of 2010, the prudent measures adopted by the brsa accompanied by the safeguarded fiscal discipline strengthened the central bank ’ s hand. we firmly believe that we will attain very positive results with respect to price stability and financial stability by the end of 2012. along with national macroprudential measures introduced by countries, some international criteria have also been developed for the sake of safeguarding financial stability. for example, the basel iii accords bring about new arrangements reinforcing the capital structures of financial institutions. these arrangements will ensure a more resilient financial sector against unforeseen risks and will contribute to financial stability. the recent efforts clearly point to a consensus among countries on the critical importance of safeguarding financial stability. despite the consensus among policy - makers on the importance of financial stability, the economic literature lacks adequate theoretical and empirical studies on the details of the transmission mechanism from financial stability to macroeconomic stability. at this point, academia is expected to do their share in this respect. the two - day conference will stage parallel sessions, panel discussions and presentations on these issues. banking sector dynamics, macroprudential measures and their impact on macroeconomic stability, systemic risk issue and sovereign debt dynamics are among the topics that will be addressed at the conference. two of our distinguished guests, mr. ricardo caballero and mr. franklin allen, will be delivering speeches. mr. caballero will be presenting a speech on the first day of the conference and mr. allen ’ s presentation is scheduled for the second day. on the second day of the conference, the panel discussion titled “ how did the crisis challenge the central banking as we knew it? what should ( not ) change? ” will be held, at which senior central bankers will be sharing their country experiences. i think this panel discussion will be very interesting and beneficial for all the participants. the studies that will be presented throughout the conference will contribute to better understanding of the factors threatening financial and macroeconomic stability and developing policies to achieve these two objectives simultaneously. i believe that the conference will also serve as a forum for the participants for exchanging views. in this respect, i would like to thank the organization committee for their efforts in bringing these very interesting and enlightening studies under this conference. i wish the conference a complete success and i would like to thank all our guests for their participation. bis central bankers ’ speeches