Similarly, the measure of longer-run inflation expectations reported in the University of Michigan Survey of Consumers has drifted down somewhat over the past few years and now stands at the lower end of the narrow range in which it has fluctuated since the late 1990s. The shifts in these measures notwithstanding, the argument that inflation expectations have actually fallen is far from conclusive.
Therefore, there continues to be room to keep rates steady. although the room for keeping stance of policy has narrowed, given the aforementioned global and domestic risks. Second, the BSP will continue to closely monitor movements in the exchange rate. Our assessment shows that the peso will remain fundamentally supported by robust economic growth and the BOP surplus.