nestor a espenilla, jr : the big picture speech by mr nestor a espenilla, jr, governor of bangko sentral ng pilipinas ( bsp, the central bank of the philippines ), at the bloomberg fx 2017 forum, makati city, 30 august 2017. * * * distinguished guests, ladies and gentlemen, it is a pleasure to be here at the 17th bloomberg foreign exchange summit. it is a pleasure too to share the spotlight with dr. mark mobius and mr. john lagman, whose insights contribute to making financial markets more efficient and effective catalysts of economic growth. good afternoon to all. the exchange rate developments in the foreign exchange market and the peso have garnered significant attention of late. for the first time this year, the peso breached the p51 / 1us $ mark, closing at p51. 11 / 1us $ yesterday. indeed, if one uses the bloomberg news search function, one will discover that the words, “ peso ” and “ bsp ” have appeared together 7. 5 times a day since may 2017. this is significantly greater compared to the frequency of 2. 9 times a day in the first four months of the year. what seems to be the concern? i am here to share the big picture with you – to share the forest for the trees. under a flexible exchange rate regime, domestic currency fluctuates and acts as an automatic stabilizer to contain swings in financial markets … these fluctuations are not in themselves bad … rather, they shield the economy from temporary shocks. in fact, there are studies showing that a flexible exchange rate better positions emerging market economies to moderate the impact of global financial and monetary forces. recent developments in the peso are largely brought about by strong and broad - based imports growth, reflecting the economy ’ s solid growth momentum. investments by both the private and government sectors continue to expand. we are also seeing he private sector expanding their businesses overseas and actively managing their financial exposures. additionally, the expected u. s. rate hikes and possible unwinding of the fed ’ s balance sheet by year - end likewise contribute to depreciation pressures on the peso due to portfolio re - balancing. we have responded to these developments by allowing a moderate and gradual depreciation of the peso as part of a healthy defensive adjustment process. amid these developments, we are confident that the country ’ s robust growth, stable inflation environment, strong and resilient

of stories of athletes with successful careers but who experience financial ruin when their careers end. fortunately, among all these sad stories, there is one about an nba superstar who retired a few years back. his spending habits were legendary – he is rumored to have spent one million dollars, in less than half an hour! his wise banker supposedly warned him to “ get it together ” or else he end up broke like many other former successful athletes. as the story would have it, the nba superstar decided to become educated in money and finance. he went back to school, got his bachelor ’ s degree, a master of business administration and eventually went on to earn his doctor of education in human resource development. this is the story of dr. shaquille o ’ neal. as we know of him today, he has several restaurants, car washes, fitness centers, a shopping center, a movie theater while he continues to be a product endorser and nba tv analyst. by all accounts then, he is financially secure and if the popular story is accurate, it all goes back to his early “ turnaround ” and eventual commitment to manage his finances. bis central bankers ’ speeches i share this story not to say that the value of financial literacy is for those fortunate enough to become millionaires. instead, i use it to highlight that even for those who have much, financial literacy matters also. but financial literacy is not just for them. financial literacy is also for the juan and juana dela cruzes who, even if they do not have million - dollar paying jobs are conscious of preparing for a future that offers no guarantees. if we accept that tomorrow always holds some uncertainty, we have to accept as well that there is no switch that we can turn “ on ” or “ off ” to rectify an unexpected development. the issue before us is whether or not we are sufficiently aware and adequately empowered to manage our personal finances today. while the bsp already has several financial education outreaches, we know that much more can be done towards empowering our financial consumers. and we are committed towards this goal. this afternoon ’ s book launching is a concrete manifestation of this commitment. for this endeavor, let me thank the authors of the articles. the readers of our wealth watch book will certainly benefit from your “ wealth ” of experiences as practitioners in the field of finance. let me also thank our financial consumer protection department that always tries to think outside of the box in designing new and innovative means of delivering