and 2020, respectively. such is higher than the gdp growth forecasts for thailand ( 2. 4 and 2. 8 % for 2019 and 2020, respectively ), indonesia ( 5. 0 and 5. 2 % ), and malaysia ( 4. 5 and 4. 3 % ). on inflation, price pressures have been dissipating since late 2018 with average headline inflation at 2. 5 % for 2019. this is well within the government ’ s 2 - 4 percent target range for the year. looking ahead, the latest baseline forecasts indicate that inflation is projected to average 2. 9 % for both 2020 and 2021. the balance of risks to future inflation appears to be weighted toward the upside for 2020 but remains tilted to the downside for 2021. petitions for electricity rates and transport fare adjustments, the proposed increase in excise taxes on alcoholic beverages, the impact of african swine fever ( asf ) on meat prices, and higher global oil prices are seen as the main upside risks to inflation. meanwhile, slower global economic growth due to the escalation of protectionist policies in advanced economies as well as geopolitical tensions continue to be the main downside risks to inflation. equally important, inflation expectations – based on forecast surveys of private sector analysts – have remained manageable and well within the government ’ s 2 - 4 % target range. results of the bsp ’ s survey of private sector economists for november 2019 showed unchanged mean inflation forecasts for 2019 to 2021. last year, the monetary board ( mb ) cut the bsp ’ s policy interest rate by a total of 75 bps and the reserve requirement ratio by a total of 400 bps. the mb believes that prevailing monetary policy settings remain appropriate, supported by the benign inflation outlook and a strong positive outlook for domestic economic growth. in terms of the policy rate outlook for 2020, the bsp will always be data dependent with its decisions. that is, each policy decision will 2 / 7 bis central bankers'speeches be based on all the available information to monetary authorities at the time of its decision. for this reason, the bsp will continue to closely monitor economic conditions and on making reasonable assumptions about the future when formulating its monetary policy. while emphasis is given to inflation and inflation expectations, we also consider a wider set of economic variables and their dynamics in deciding on monetary policy. the bsp examines demand conditions, domestic liquidity and credit, financial market variables, and the external landscape in deciding whether adjustments

in the monetary policy stance are warranted. nevertheless, the phillippines has sufficient policy space, both monetary and fiscal, to deal with external shocks and their spillovers to the domestic economy. let us not forget that an appropriate mix of monetary, fiscal, and other structural policies is crucial in achieving the government ’ s macroeconomic objectives. economic activity in 2020 will be supported by strong household consumption, robust agricultural sector activity, increased government spending following the timely approval of the 2020 national budget, and higher capital spending for the public sector ’ s build, build, build program and private sector ’ s capital formation. nevertheless, even amid external headwinds, the country ’ s external payments position recently made a turnaround from a negative position in 2018, to a surplus of us $ 6. 27 billion for the period january – november 2019. the surplus in the bop position may be attributed partly to higher net inflows of foreign direct investments and foreign portfolio investments which was bolstered by favorable investor sentiment on the country ’ s solid macroeconomic fundamentals. at the same time, the current account balance in the first three quarters of 2019 posted a narrower deficit of us $ 992 million from us $ 5. 8 billion in the same period in 2018. this positive development was due largely from the lower trade in goods deficit combined with higher net receipts in the trade in services, and in the primary and secondary income accounts. the deficit in the current account is largely a reflection of the rise in investments in the economy over the past few years. this in turn has been due largely to the government embarking on an ambitious, but also long - overdue infrastructure program. the latest outlook for the balance of payments already takes into account the national government ’ s ( ng ) planned increase in infrastructure spending over the medium term. the current account is expected to be in deficit in the medium term, reflecting continued imports of capital goods, raw materials and intermediate goods imports as the government ramps up its massive infrastructure program. nonetheless, fiscal spending is being undertaken prudently. the ng has put a cap on its fiscal deficit to gdp ratio at 3. 2 percent for 2019 and 2020, mitigating any pressure on the current account coming from the infrastructure program. moreover, as public infrastructure investments result in an overall improvement in productivity and overall capacity of the economy, the subsequent boost in manufacturing and export activities as well as the continued strong inflows from ofw remittances, business process outsourcing