In spite of some reversals during the financial year 2008-09, the key financial indicators of the banking system do not throw up any major concern or vulnerability and the system remains resilient; and  (ii)  The single-factor stress tests carried for the commercial banking sector covering credit risk, market / interest rate risk and liquidity risk have revealed that the banking system can withstand significant shocks arising from large potential changes in credit quality, and liquidity conditions.
But we need to recognize that many people don’t feel like inflation is falling when food inflation has been averaging almost 3 percent. People should know that we are taking that into account when we make policy. Deputy Governor Larry Schembri devoted an entire speech to this topic earlier this week. A key to enhancing our relatability is listening—engaging the public in conversations.