talk about china. you may ask, shouldn ’ t we also devalue the peso, after all a currency war seems to be in play? bis central bankers ’ speeches textbooks describe competitive devaluation as a “ beggar thy neighbor policy ”. but that said, we know that policy makers will always do what they believe would be best for their own specific needs, sometimes without much concern for the impact of their actions on other jurisdictions. this brings to mind a higher policy consideration – the principle of “ enlightened self - interest ” as espoused by the bank for international settlements. bis general manager jaime caruana said that while it may seem that “ keeping one ’ s house in order ” is good defense, having a policy mindset of also taking into account spillovers of one ’ s actions may lead to improved overall welfare. after all, we share the same space, so to speak, and the same spillovers may “ spill back ” to one ’ s economy. my own appreciation of this principle is that seeking only one ’ s own goals may lead us to sub - optimal results. given the size of our domestic market, we don ’ t think there is compelling reason to deviate from our current fx policy of allowing the markets to broadly determine the exchange rate. just as we did during the period of strong capital inflows in earlier years, we will allow the exchange rate to adjust to market conditions also during this period when the potential for capital outflows may increase. the bsp will not go against the fundamental trend in the fx market, but we reserve scope for official action to smoothen volatilities that could disrupt business planning and dislodge inflation expectations. this policy is both efficient and equitable because the exchange rate affects different sectors of the economy, differently. depreciation benefits exporters and other dollar earners, while it weighs on the debt burden of borrowers in foreign currency and increases the input cost of importers. i hear some murmurs, even see some quizzical looks. well, let me borrow a phrase from stan fischer when he spoke at jackson hole over the weekend. i don ’ t wish to “ disappoint your rational expectations ” that i won ’ t tell you whether a breach of a certain exchange rate level would worry the bsp or not. actually, the bsp has no “ magical ” exchange rate. as i have repeatedly said, the bsp doesn ’ t target specific

to have at least 70 percent of adult filipinos owning a transaction account by 2023. the thrift banking industry has to embrace and be ready for the opportunities and realities under the new economic arrangements. allow me also to commend the 12 thrift banks that are offering pesonet payment transactions and the eight thrift banks offering the instapay platform for sending and receiving payment services and the four thrift banks that provide receiving payment services. you are among the movers under the digital payments transformation roadmap. nevertheless, we are also mindful of the attendant risks and the unintended consequences of these developments. in this area, we rely on our long - standing partnership with the chamber of thrift banks to help us 2 / 3 bis central bankers'speeches in mitigating the effects of technology - related risks, in promoting financial integrity and transparency in financial transactions while working towards sustaining the resiliency and stability of the banking system. ladies and gentlemen, disruptive technology and the covid - 19 pandemic are drastically changing the future of financial services industry. there are rough seas and strong headwinds coming from these two realities. but we must not lose track of our collective goal of keeping the banking system on even keel so it remains supportive of economic recovery and growth over the long - term. together, we can work towards developing a safer, more dynamic, more digital, and more inclusive banking system for the banking public. mabuhay ang chamber of thirft banks and i wish you all a meaningful convention ahead! thank you all! 3 / 3 bis central bankers'speeches