microfinance has become a viable proposition for banks. in fact, we can say that microfinance as a medium for financial inclusion, has strengthened the institutional stability of banks by generating reliable business opportunities. this is because the microfinance industry has evolved from a narrow focus on microcredit to a more holistic, sustainable and “ value - adding ” provision of financial services to our target market. for example, 69 of the 183 banks with microcredit operations now hold 1. 7 million microdeposit accounts. in early 2012, there were only 22 such banks. in addition, 86 of these banks have decided to offer microinsurance to their clients. furthermore, 26 of these banks now provide e - banking services, including mobile money – a more cost - efficient transactional platform for both banks and clients. ladies and gentlemen. the availability, accessibility and affordability of these financial products have drawn more microentrepreneurs to do business with banks. from this, we have learned that developing appropriate products and delivery channels enable financial institutions to serve markets that were previously marginalized. this is a solid foundation to build on for our broader financial inclusion program. bis central bankers ’ speeches it appears therefore that in the case of the philippine microfinance sector, we have achieved convergence in the delivery of positive financial results and social performance management. congratulations everyone! the bangko sentral is pleased to contribute to the success of microfinance in our country. we deliberately crafted our regulations to fully support the safe and sound development of microfinance. we believe that financial inclusion, through microfinance, complements our financial stability objectives. thus, our regulatory environment is conducive to expand financial access while preserving financial stability and integrity, deepening financial education, and ensuring consumer protection. congratulations bsp! credit should also be given to our microfinance institutions including banks and ngos who took advantage of this enabling regulatory environment to magnify their outreach. they are the ones directly catalyzing change on the ground – in small businesses, in poor households. finally, i am pleased to share the good news that the survey on financial inclusion conducted by europe - based economist intelligence unit gave the philippines high scores on account of strong leadership, highly capable regulators, optimal credit regulation and effective dispute resolution. overall, the philippines is ranked as the top country in asia, and third in the world, with the most conducive environment for financial inclusion. the eiu notes that

of the supply chain disruptions resulting from recent restrictions in asia. following a steady rise in the course of 2021, inflation reached a record high of 7. 4 % in march 2022, remaining at this level in april. price increases will most likely remain high over the coming months, mainly because of the rise in energy costs but also due to higher food prices and renewed supply chain disruptions. medium - term inflation expectations remain anchored, close to our 2 % target. that said, we are closely monitoring for second - round effects, notably wage - setting behaviour. we need to prevent the scenario where the high inflation that we currently see becomes entrenched in expectations. we are faced with an exceptional degree of uncertainty regarding the outlook for economic activity and inflation. so we need to move gradually and cautiously as we normalise our monetary policy. at our april meeting, the ecb ’ s governing council judged that the incoming data reinforced our expectation that net asset purchases under the asset purchase programme should be concluded in the third quarter. i would expect this to happen earlier in the third quarter rather than later. a first interest rate hike could take place some time after that, depending on our evolving assessment of the outlook. our june staff projections will put us in a better position to appraise where the euro area economy is heading. we need to observe the impact that shifts in financing conditions and the erosion of purchasing power are having on activity and inflation dynamics. for the past two years, the combination of fiscal and monetary policy has been crucial in helping the euro area to navigate the pandemic. this combination remains critical today. monetary policy has to ensure that inflation stabilises at 2 % over the medium - term while fiscal measures need to be very selective, targeted and temporary – also in part because fiscal space is now more limited than it was in 2020 and 2021. despite the current uncertainty, financial markets have, so far, remained relatively calm. if stress conditions arise, we will deploy flexibility to ensure that monetary policy is transmitted smoothly across the euro area, as we did to good effect during the height of the pandemic. financial stability the macroeconomic forces i have just discussed, amplified by the economic fallout from the russiaukraine war, also have implications for the financial stability outlook. the improved economic conditions throughout 2021 helped to reduce near - term risks to financial stability. but medium - term vulnerabilities continued to build up in the latter half of last year. the pandemic left