As important as the participation of hedge funds, the derivative products themselves allow credit risk to be hedged, which has the beneficial effect of further increasing the pool of other investors as well. The increase in financial product and provider innovation appears to be quite persistent; future trends, however, are likely to be significantly influenced by legal, regulatory, and other public policies.
The BSP’s mandates on price and financial stability and efficient payments system have been strengthened with the amendments to the BSP Charter in February 2019. So, how do we address the effects of climate change? On monetary policy, data on natural disasters, including the damage to the agriculture sector and other industries essentially feed into the BSP’s policy analysis.