However, even taking these special factors into account, the underlying rate of monetary expansion remains strong. Moreover, the sustained expansion of loans to the domestic private sector, which grew at an annual rate of 11.2% in October, points to the  2  BIS Review 145/2007  continued vigour of underlying monetary dynamics.
Monetary developments therefore continue to require very careful monitoring, both to detect underlying trends associated with inflationary pressures at longer horizons and to better understand shorter-term dynamics. Such monitoring will also provide a more complete picture of the response of the private sector to the increased volatility in financial markets.