saw inflation halve again to 2. 6 % in june when we started lowering interest rates. the new data available at the time of the september governing council meeting reinforced our confidence in the timely return of inflation to our 2 % target. we therefore lowered the rate on the deposit facility, which is the rate through which we steer the monetary policy stance, by another 25 basis points to 3. 5 %. we are determined to ensure that inflation returns to our 2 % medium - term target in a timely manner. we will continue to follow a data - dependent approach to determining the 2 / 5 bis - central bankers'speeches appropriate level and duration of restriction, focusing on the inflation outlook, the dynamics of underlying inflation and the strength of monetary policy transmission. policy rates will be kept sufficiently restrictive for as long as necessary to achieve our aim. we are not pre - committing to a particular rate path. moreover, as we announced on 13 march 2024, some changes to the operational framework for implementing monetary policy took effect from 18 september. 1 in particular, the spread between the interest rate on the main refinancing operations and the deposit facility rate was set at 15 basis points. the aim is to steer short - term money market rates more closely in line with monetary policy decisions. in parallel to our policy deliberations, we have also launched an assessment of our monetary policy strategy. this assessment will be more limited in scope than our last review, which we completed in july 2021, and will include two work streams. one work stream will focus on the changed inflation environment and the other on the implications for our monetary policy strategy, including what we can learn from the periods of both low and high inflation. we expect to conclude the assessment in the second half of 2025 and i intend to keep you informed in our regular hearings and interactions. advancing capital markets union let me now turn to the second topic of this hearing – the capital markets union. the ecb has long emphasised the need for progress in this area to integrate our fragmented markets and thus foster risk diversification and shock absorption across the eu. doing so would support financial stability and facilitate the transmission of monetary policy. but a deep and integrated single market for capital is also essential for achieving some of the eu's other key goals, from financing the green and digital transitions to enabling savers to earn higher returns. additionally, young and innovative firms need to grow and become more productive, which will ultimately benefit all europeans. for the time being

and management of three banks. several institutions were forced to liquidate or merged with strong institutions. if these actions were not taken these banks would have collapsed with disastrous effects for the financial markets. ( b ) several development financial institutions have either been closed, wound up, privatized, converted into a bank, restructured and adequately capitalized for eventual sale to the private sector. ( c ) an independent assessment of the financial sector by a joint world bank - imf team has concluded that the financial soundness indicators of pakistani banking system are robust and can withstand exogenous shocks. observance of internationally accepted standards and codes has found to be quite high. ( d ) minimum capital requirements of banks have been raised twice during the last four years to weed out weak banks and allow mergers and consolidation to take place so that fewer but stronger banks operate in the system. ( e ) stringent measures have been laid and enforced on classification of non - performing loans, loan loss provisioning, tier 1 and tier 2 capital adequacies, write off of unrecoverable debt and allocation of capital against market risk. ( f ) three different sets of regulations specifically tailored to manage the risk profiles of corporate, consumer and sme lending have been issued by the state bank in consultation with the banks and businesses. central bank autonomy central banks are required to promote the establishment and operation of a safer and sound financial system i. e. the framework of prudential regulations and supervision as well as payment and settlement systems. central banks also play a critical role in crisis management through provision of emergency liquidity assistance. finally, price stability has to be assured to lay the foundation for long - term sustainable growth. for these functions to be performed effectively the central banks require a degree of autonomy. state bank of pakistan has gradually won a substantial amount of autonomy and independence during the last several years. the laws governing the bank have been modified from time to time to provide adequate decision making authority and powers in respect of the conduct of monetary policy, banking supervision and regulation, exchange rate and foreign reserves management and payment and settlement system. a monetary and fiscal coordination board has been set up to coordinate monetary and fiscal policies. an independent board of directors consisting of seven eminent individuals drawn from various walks of life oversees the activities of the bank and formulates policy guidelines. the ministry of finance has only one representative on the board and exercises a single vote in decision - making. the governor and the board cannot be removed by the