at 4. 5 percent in august 2021, higher compared to 2. 8 percent a year ago, the uptick was accompanied by loan - loss provisioning with an npl coverage ratio of 83. 5 percent. meanwhile, the country ’ s external sector remains manageable. the country ’ s exports and imports of goods increased by 21. 3 percent and 31. 6 percent, respectively. 1 / 4 bis central bankers'speeches cash remittances from overseas filipinos ( ofs ) are also strengthening, with 5. 7 percent growth in january to august 2021, from a 2. 6 percent contraction in the same period in 2020. meanwhile, the bpo sector remained a bright spot despite the disruption to business activities around the world. in the first seven months of 2021, net foreign direct investments increased by 43. 1 percent. this is due to positive foreign investor sentiment on the country ’ s macroeconomic fundamentals and strong growth prospects. the country ’ s outstanding external debt also remains at a prudent level as its ratio to gdp slightly eased to 26. 5 percent in end - june 2021. notably, a large portion of our external debt has medium - and long - term maturity profile and carry fixed interest rates. these support a manageable debt repayment schedule and foreign borrowings are less susceptible to volatilities in global interest rates or foreign exchange fluctuations. the gross international reserves ( gir ), which stood at us $ 106. 6 billion as of september 2021, continue to provide more than adequate external liquidity buffer. the gir level is equivalent to almost 11 months worth of imports of goods and payments of services and primary income. this far exceeds the 3 - month conventional reserve level considered as adequate. let me now go to the policy responses of the bsp to support the economy during the pandemic. first were measures to boost market confidence on availability of low cost credit resources, such as cuts in the policy rate and the reserve requirement. second were extraordinary liquidity measures to the national government to help fund the pandemic - response measures. these include provisional advances to the national government, purchases of government securities in the secondary market, and remittance of advance dividends to the national governments. third were regulatory and operational relief measures to maintain stability of the financial system and ensure public access to financial services. we counted loans to micro, small, and medium enterprises as compliance to the reserve requirement, increased the single borrower ’ s limit, and raised

bsp will remain vigilant over the current inflation dynamics to ensure that the monetary policy stance continues to support economic recovery to the extent that the inflation outlook would allow. it will carefully scan the operating environment with a forward - looking perspective to move in a pre - emptive fashion to address any risks to our price stability mandate. on the financial sector : the bsp will intensify its monitoring and surveillance over its supervised institutions to ensure that they remain resilient to emerging risks and continue to be sound, stable, and inclusive, particularly through the pursuit of enhanced digitization. finally, on the external sector : the bsp will remain supportive of policies that will help strengthen the economy ’ s resilience to external shocks, including that of maintaining a market - determined exchange rate, keeping a comfortable level of reserves, and keeping the country ’ s external debt manageable. considering the recent economic developments and significant improvement in inoculation, we are optimistic that there is sufficient support for the country ’ s recovery this year and in the near term. finally, allow me to end my presentation with these key points : the country ’ s macroeconomic fundamentals remain sound and bright spots suggest recovery is 3 / 4 bis central bankers'speeches underway. the latest gdp growth suggests that the economy has started its gradual recovery. the currently high inflation is due to transitory factors. banks remain sound and while npl has increased, banks remain highly capitalized. external position is manageable with more than adequate external liquidity buffer and improving overseas filipino remittances. while economic activity has improved, the overall momentum of the economic recovery remains tentative as the threat of new covid - 19 strains continues. nevertheless, the sustained implementation of targeted fiscal initiatives as well as the acceleration of the government ’ s vaccination program should help boost market confidence and recovery of the economy in the coming months. the bsp believes that sustained monetary policy support for domestic demand should help the economic recovery gain more traction. looking ahead, the bsp affirmed its support to the economy for as long as necessary to ensure the country ’ s strong and sustainable economic recovery. the bsp ’ s actions and policy thrusts will continue to be anchored on its core mandates of promoting price and financial stability. toward this end, the bsp will continue to pursue appropriate policy actions responsive to the needs of the time. it will also continue undertaking a range of initiatives to create a more sustainable msme and agriculture financing ecosystem. thank you. 4