On the other hand, the monetary authority must avoid that liquidity problems in the government debt market will turn into solvency problems hindering the conduct of monetary policy itself. An extreme situation is one in which the central bank intervenes directly in the market for government securities and seeks to systematically influence yields.
Benjamin E Diokno: Virtual Signing Ceremony for the MOU with British Embassy of Manila on the Prosperity Fund for the ASEAN Economic Reform Programme (AERP) and the ASEAN Low Carbon Energy Programme (ALCEP) Address by Mr Benjamin E Diokno, Governor of Bangko Sentral ng Pilipinas (BSP, the central bank of the Philippines), during the virtual Signing Ceremony for the MOU with British Embassy of Manila on the Prosperity Fund for the ASEAN Economic Reform Programme (AERP) and the ASEAN Low Carbon Energy Programme (ALCEP), Manila, 17 March 2021.