in service providers and critical infrastructures in the financial and payment systems. in june 2016, the cpmi and the iosco published a document titled guidance on cyberresilience for financial market infrastructures. 2 this document highlights the importance of the safe and efficient operation of fmis in the maintenance and promotion of not only financial stability, but also economic growth. this publication intends to give guidance to industry to enhance its cyber - resilience, and hopes to provide regulators and authorities with a set of internationally agreed guidelines to effectively support, oversee, and supervise fmis. regulators are encouraged to cultivate a culture of awareness and an understanding of the risks inherent in the cyber - environment. all participants should not only be aware of but also understand their role and the importance of improving their cyber - resilience position at every level within the organisation. in this regard, the sarb will host a conference on cybersecurity in august with the objective of creating a platform for various role players in the financial sector to further strengthen their cyber - resilience. globally, there has been a wave of innovation in the payment environment, ranging from mobile payments to real - time low - value payments. advances in technology and access to the internet have facilitated innovation in various payment technologies. the financial technology ( or fintech ) revolution has played a key role in the development of innovative and disruptive technology, and is changing the way in which we look at financial, payment, banking and mobile services, to name but a few. what we are witnessing at the moment is this : where inefficiencies are perceived within the system, savvy service providers find a technology solution to overcome the inefficiency and provide the service in a cheaper and more efficient manner. such innovation is especially prevalent in the payment, mobile, remittance and online environments, such as online shopping and e - commerce. although fintech is providing many exciting opportunities, it should be balanced by efficiency, safety and financial stability considerations. it is not the role of regulators to hamper innovation, but the sarb is jointly responsible for financial stability, which includes aspects such as cybersecurity, infrastructures, and a safe and efficient financial system. we therefore need to strive towards achieving a healthy balance when we respond to these developments. 2 available at http : / / www. bis. org / cpmi / publ / d146. htm bis central bankers ’ speeches recently, many central banks –

economy in 2016 and 1, 2 percent in 2017. the sarb forecasts for 2017 have also been revised down to 1, 4 percent and 1, 8 percent in 2018. the most recent estimates by the sarb indicate that potential output growth of the south african economy has declined from 1, 9 percent to 1, 5 percent for 2016, and from 2, 1 percent to 1, 6 percent for 2017. with lower growth outcomes, the output gap is expected to remain negative over the forecast horizon. the policy challenge is to ensure that the economy is not trapped in a cycle of persistent low growth. south african policymakers are fully aware that we have to avoid the risk of becoming trapped in what christine lagarde, the md of the imf, has termed the “ new mediocre ”. the budget, which was tabled in february, reinforces the need to provide support to economic growth, albeit against a background of deteriorating prospects for tax revenue collection. the budget sets out to accomplish this through a path of more rapid fiscal consolidation. in the main, the budget focuses on containing administrative expenditure ( most notably salaries ) while maintaining investment and other core expenditure items at levels that will be supportive of economic growth. the package of tax measures that have been introduced in the 2016 budget has also spread the additional tax burden over several revenue sources so as to limit the adverse short - term impact on growth. as a ratio of gdp, the deficit of national government is projected to narrow from 4, 2 percent in the 2015 / 16 fiscal year to 2, 9 percent by fiscal 2018 / 19. it is noteworthy that the budget sets out a more rapid adjustment path than what was envisaged in the 2015 medium term budget policy statement in october last year. these projected outcomes are commendable in the current circumstances, and if implemented effectively, will contribute to dampening inflationary pressures and impact favourably on investor confidence and south africa ’ s credit rating metrics. south africa ’ s inflation outcome and outlook the trajectory for the year - on - year inflation rate as measured by the consumer price index ( cpi ) has increased significantly over the last three months. consumer inflation measured 7 percent in february, up from 6, 2 percent in january and 5, 2 percent in december 2015. on a month - to - month basis, headline cpi increased by 1, 4 percentage points between january 2016 and february 2016. headline cpi inflation for february exceeded both the reuters and bloomberg consensus forecast of 6, 8 percent