the philippine central bank. extending unprecedented assistance to support the economy in crisis mode 1 / 6 bis - central bankers'speeches let me go back to the topic of navigating through the headwinds, the way ahead for central banks. for us to look to the future, it is important to look at where we came from. let me provide some context on the philippine central bank's actions during the pandemic. [ first ], we reduced the policy rate to 2. 0 percent. to put that in context, at that time, our inflation forecast was at least 3. 0 percent so we were actually going into negative interest rate territory. number two, we bought p1 trillion worth of government securities. because of covid, banks were fleeing to cash. to our great credit as an inflation - targeting central bank, they are fleeing to pesos, not to dollars. unfortunately, the fall in bond prices would have resulted in very high market interest rates so we [ at the central bank ] ended up buying 1 trillion worth of government securities relative to our balance sheet of [ about ] 5 trilion [ prior to the pandemic ]. 1 in addition, we lent money to the government – directly and as approved by congress. it was a very transparent [ form of ] assistance from the central bank to the government. of course, we thought that every time we do something like this, something we have never done before, we must have an exit plan. our [ initial ] exit plan was a beautiful one : as soon as the economic conditions improve, [ we will implement ] a long series of 25 basis points ( bps ) increases, bringing back to policy rate to 3. 5 percent to 4. 0 percent. but as they say, it is very hard to predict, especially the future. what happened, instead [ of our exit plan ], is that global developments - - the ukraine war, the abrupt pivot of the fed - - and of course, very high inflation [ changed our plans ]. for 2022, when you look at seasonally adjusted month - on - month ( mom ) inflation, only one month [ december 2022 ] is it is consistent with the target at 0. 3 percent, which translates to 3. 6 percent [ once annualized ]. to make matters worse, [ at ] the beginning of 2023 had a huge supply shock, [ resulting in ] a 1. 0 percent increase in seasonally adjusted mom inflation [

strong loan growth to non - financial corporations suggests that the supply of bank credit to firms in the euro area has not been significantly impaired by the financial turmoil thus far. further data and analysis will be required in order to obtain a more complete picture of the impact of the financial market developments on banks ’ balance sheets, financing conditions and money and credit growth. to sum up, a cross - check of the outcome of the economic analysis with that of the monetary analysis clearly confirms the assessment that upside risks to price stability prevail over the medium term, in a context of very vigorous money and credit growth and with no significant signs of supply constraints on bank loans to households and non - financial corporations. the economic fundamentals of the euro area are sound. incoming macroeconomic data continue to point to moderate but ongoing real gdp growth. however, the level of uncertainty resulting from the turmoil in financial markets remains unusually high and tensions may last longer than initially expected. against this background, we emphasise that the firm anchoring of medium to longer - term inflation expectations is of the highest priority to the governing council. we believe that the current monetary policy stance will contribute to achieving this objective. the governing council remains strongly committed to preventing second - round effects and the materialisation of upside risks to price stability over the medium term. we will continue to monitor very closely all developments over the coming weeks. regarding fiscal policies, the intentions reflected in the latest round of stability programmes imply a rise in the euro area general government deficit ratio in 2008. further fiscal pressures are likely to arise as overly optimistic macroeconomic assumptions are already being revised downwards and political demands for fiscal loosening are increasing. in this situation, countries with fiscal imbalances are urged to make further progress with structural consolidation, in line with the requirements of the stability and growth pact. at the current juncture, particularly prudent and stability - oriented fiscal policies would also contribute to containing inflationary pressures. turning to structural reforms, we welcome the launch of the 2008 - 10 cycle of the renewed lisbon strategy for growth and jobs by the european council. the favourable labour market trends in the euro area suggest that economic reforms are paying off. however, many challenges remain as overall employment is still below the lisbon target of 70 % and unemployment is still unacceptably high. moreover, productivity growth remains weak, constraining general income growth. therefore, we strongly encourage euro area countries to increase reform efforts, in particular to foster market integration and to reduce rigidities in