The Central Bank of Seychelles (CBS) will benefit from greater autonomy from the Treasury during the forecast period, as part of an IMF-sponsored reform process, which will assist in meeting specified monetary targets. Until recent reforms the CBS relied on exchange-rate management to tackle inflation, as most consumer goods are imported. However, since exchange controls have been lifted, the CBS-with technical help from the IMF-is instead turning to indirect instruments, including new-style Treasury-bill auctions, to help to manage liquidity and reserve money supply. Monetary policy was tightened sharply when the reforms began in late 2008, but was loosened in 2009 when inflation eased: the CBS scrapped the local asset ratio requirement (freeing banks from mandatory investment in Treasury securities) and reduced banks' minimum reserve requirement from 12% to 10%. The 91-day T-bill rate peaked at 29.3% in January 2009, but fell below 0.5% by the end of 2010, reflecting deflation. Rates will drift higher as inflation turns positive again in 2011-12, but will remain relatively stable during the forecast period. Average commercial lending rates are much higher (11.5% in December), leaving scope for reductions in 2011-12 pending more competition in the banking sector.