BSP's Espenilla on Interest Rates, Peso, Credit Growth

The video features a discussion with the governor of the central bank in the Philippines. It covers the decision to maintain current monetary policy settings due to stable inflation and strong domestic demand. The governor addresses concerns about the peso's exchange rate, credit growth, and systemic risks. He also discusses the impact of tax reforms and oil prices on inflation. Strategies to reduce reliance on remittances and plans for financial reforms, including reserve requirement adjustments, are also highlighted.

What was the main reason for keeping the interest rates unchanged in the Philippines?

• High inflation rates

• Weak domestic demand

• Unstable economic conditions

• Benign inflation and strong domestic demand

How does the BSP manage the exchange rate of the peso?

• By pegging it to a basket of currencies

• By fixing it to the US dollar

• Through a flexible exchange rate policy

• By adjusting it monthly

What is the expected impact of the tax reform on inflation?

• No impact on inflation

• Minimal impact within the target range

• Significant increase in inflation

• Decrease in inflation

What is the current state of credit growth in the Philippines?

• It is stagnant

• It is expanding at a manageable pace

• It is declining rapidly

• It is causing overheating in the economy

What measures are being taken to control the real estate market?

• Providing subsidies

• Increasing interest rates

• Implementing macroprudential measures

• Reducing taxes

What is the government's strategy to reduce reliance on remittances?

• Increasing remittance fees

• Encouraging more overseas employment

• Widening the economic base through investments

• Reducing foreign direct investments

Under what condition might the reserve requirement be reduced?

• If GDP growth exceeds 10%

• If inflation remains stable

• If the peso strengthens significantly

• If remittances increase