##opening of the services sectors, boosted the demand for goods while supply remained constrained. this, in turn, fuelled what would eventually be the highest rates of global inflation in a generation. 1 as the global economy was gradually recovering from the covid - 19 shock, another unexpected shock came early last year : russia ’ s invasion of ukraine which triggered a war that still rages on today. the war in ukraine compounded the shock to the prices of oil, gas and some inputs into food production, such as fertilisers – further fuelling the global inflation problem. with the benefit of hindsight, we now know that the various stimulus efforts by policymakers contributed to the inflation problem we are currently sitting with. nonetheless, the stimulus was much needed and supported demand conditions at a time when consumer confidence had been crushed by the lockdowns and furloughs. however, it is now clear that fiscal and monetary policy remained too loose for far too long. the ultra - low interest rates and generous transfers to world inflation calculated by haver rose to a peak of 9. 4 % in september 2022 and was still in excess of 7 % in march this year. households and businesses created excess demand ‒ in an environment where supply constraints have lowered potential output in most economies ‒ which, in turn, ignited the inflation problem we currently face. subsequently, global inflation pressures have resulted in many central banks around the world embarking on unusually fast and synchronised monetary policy normalisation. the sarb itself implemented a series of 75 basis point hikes over the past year – faster than in prior tightening cycles. since november 2021 to date, we have raised the repo rate by a cumulative 425 basis points. however, for context, the cumulative repo rate increases by the sarb have been below those implemented by some of our emerging market peers and, more importantly, the real repo rate is still below its estimated neutral level of 2. 5 %. where are we now? it is encouraging to see that some of the shocks that drove the surge in global inflation have begun to ease. after peaking around the middle of 2022, global inflation moderated somewhat in the fourth quarter of 2022 and into the first quarter of 2023. however, although these developments have, overall, been positive, for many economies inflation still remains elevated and well above central bank targets. importantly, inflation is showing signs of persistence in several sectors. the latest international monetary fund ( imf ) world

instructions to a more active role in assessment of loan applications before making credit decisions. this is not an easy change. it involves both time and considerable adjustment in the thinking. besides, good tools are a must for a good job : bank employees have to increase their knowledge of the banking business in a market economy and enhance their professional standards. this is precisely one of the objectives of the institute of bankers, and with its newly launched representative office in beijing, the institute will extend its existing good work to the mainland. it will help promote the training of bank employees on the mainland, thereby contributing to the effective financial intermediation and smooth functioning of this crucial part of modern economy. the economies of the mainland and hong kong are now highly interdependent. the institute ’ s beijing representative office will not only serve to enhance professionalism of the mainland ’ s banking sector as a whole, but also contribute to the financial stability and development of both the mainland and hong kong. let me end this address by wishing the institute ’ s beijing representative office every success in its future endeavours.