average ( 2005 – 2012 ) : philippines – 52. 2 ; malaysia – 144. 6 ; singapore – 290. 6 ; thailand – 123. 6 ; indonesia – 44. 3 ; taiwan ( prc ) – 118. 7 ; south korea – 84. 6. bis central bankers ’ speeches inflation would remain positive. these are wage rigidities and the upside risks from pending petitions for utility rate adjustments ( electricity ) and potential power shortages. given this scenario, what would the monetary response of the bsp be? our initial projections using lower oil prices show that inflation would still be within the target range for 2015, which is now lower at 2 – 4 percent compared to the previous year ’ s target of 3 – 5 percent. indications of easing inflationary pressures owing in part to the decline in international oil prices as well as signs of robust domestic economic growth allow the bsp some room to maintain its current monetary policy stance. even so, we do not pre - commit to a set course of action. as i have always said, the stance of monetary policy will remain data - dependent. one thing we keep in the back of our minds is that prices can reverse and often very quickly. if you have been in this market long enough – as i believe some in the audience have – you know that markets tend to get ahead of themselves. so, we continue to watch developments in the oil market carefully and how these affect inflation and growth dynamics, to see if there is any need to make adjustments in the stance of policy. while volatilities in oil prices have complicated the balance of growth prospects, there are the other underlying other risks that we see in the horizon. these include a bumpy growth path for china, delays in the needed structural reforms in the eu and japan, and geopolitical risks that could arise from a worsening of the situation in russia or the middle east – all of which can heighten financial market volatilities. can we remain steadfast in 2015? going back to the earlier question of whether we will be able to sustain our position of strength in 2015. let me share that, in the areas under the purview of the bsp, we believe we will be able to withstand headwinds in the global economy. and i have four reasons. one, our monetary policy is focused. while we are mindful of developments externally, we will always adjust policy in consideration of domestic demand and supply dynamics as reflected in our forecasted inflation path.

nestor a espenilla, jr : ensuring price stability through monetary policy presentation by mr nestor a espenilla, jr, governor of bangko sentral ng pilipinas ( bsp, the central bank of the philippines ), during the forum of the economic journalists ’ association of the philippines ( ejap ), manila, 28 august 2018. * * * secretary of finance carlos dominguez iii, dbm secretary benjamin diokno, neda directorgeneral ernesto pernia, dotr secretary arthur tugade, dpwh secretary mark villar, esteemed guests, ladies and gentlemen, a pleasant morning to all of you. i would like to thank ejap president louella desiderio, the economic journalists ’ association of the philippines for inviting me to share the bangko sentral ’ s views on inflation, as well as our game plan to address it. in the first part, i will dissect the numbers to identify the real drivers of the recent spike in inflation. i will then explain the bsp ’ s inflation outlook, or how we expect the inflation environment to evolve over the next two years. casting inflation against this proper context helps put into sharper focus the policy measures needed to address the issue. i maintain that not only have the bsp ’ s monetary responses been timely and appropriate, but that tempering inflation and its side - effects will require the coordinated efforts of various government agencies as well. let me begin with the recent inflation numbers. in the first seven months of 2018, year - on - year headline inflation averaged 4. 5 percent, well above the government ’ s target range of 2 – 4 percent for the year. as this chart shows, supply - side factors are the main drivers of overall inflation. these include rising international oil prices, higher excise taxes, and weather disturbances that affected food supply. meanwhile, in this next chart, we see how supply - side forces drive inflation on a month - on - month basis, with factors such as the recent increase in jeepney fares and utility rates contributing to the july inflation print. there are two important points that i need to highlight in this chart. the first is that the inflation momentum is slowing down, as headline inflation has generally declined in month - on - month terms from 0. 9 percent in january 2018 to 0. 5 percent in july 2018. in particular, after spiking in the first quarter of 2018, the month - on - month changes for electricity