markets last year. the appreciation of the singapore dollar led to a negative foreign exchange translation effect of s $ 8. 7 billion. the singapore dollar strengthened 4 % against the pound sterling, 5 % against the euro, and 9 % against the japanese yen. total expenditure increased to s $ 2. 8 billion, due mainly to higher interest expenses on domestic money market operations. conclusion in conclusion, let me return to where i started – inflation. the current bout of inflation will eventually end. question is : how long will it take and how much will the economy have to slow down. taming inflation is like trying to slow down a speeding car on a gentle slope. it takes a combination of forcefulness and calibration. if you do not depress the brakes early enough or hard enough, you cannot break the speed momentum – likewise, monetary policy needs to act early and decisively. but if you jam the brakes too hard, the car may skid or even topple over – the economy may go into a recession. so you have to pump the brakes progressively, to gradually slow down the car to a more sustainable cruising speed. this is why central banks all over the world tighten monetary policy in a series of well calibrated steps and closely monitor the impact of their actions before deciding on the next step. and that is exactly what mas too is doing. which is why we are not going to say anything about what we might or might not do in october!

the currency risk. the amount of that write - back was included in the bank ’ s financial income shared between the bank and the state. the brussels commercial court rejected the demand made by certain shareholders to cancel that decision, and confirmed that the annual accounts for 2003 were perfectly legal. in helping to clarify the status of our institution and shed light on its special characteristics, these court decisions should put an end to certain arguments and reduce the fluctuations in the bank ’ s share price. in the foreword to the annual report, when i mention unjustified speculation concerning these shares, i mean that these fluctuations originated because of legal arguments which we consider to be incorrect, and which the judgments so far have also refuted. * * * in 2005, the bank ’ s profits improved, mainly as a result of the increase in the amount of euro banknotes in circulation ( + 15 p. c. ), and hence the increase in the bank ’ s share of that issue. this expanded the volume of interest - earning assets held as the counterpart to the banknotes, and therefore increased the income which these assets generate. moreover, the bank earned a higher rate of interest on its dollar investments and did not have to constitute provisions, as it did in 2004, to cover losses incurred by the ecb. the improvement in the return on the assets meant that the state was once again able to receive seigniorage income. it is in return for the right of issue which the state has granted the bank that the state is entitled to the part of the income from the net interest - earning assets which exceeds 3 p. c. of those assets. the dividend paid to shareholders is, as usual, increasing in line with inflation. thank you for your attention. i will now hand you over to the vice - governor for the detailed presentation of the annual accounts for 2005 ; it is the accounts that constitute the most important information for the general meeting and which have, as in previous years, given rise to the largest number of questions from shareholders.