It lies in fiscal policy and structural reforms, combined with the proactive use of macroprudential tools. This is why the recent European-level decision on the recovery instrument Next Generation EU is so important – it checks all the necessary boxes. The programme will support national structural reforms and public investment.
This and the prevailing conditions in the economy have provided a room for the BSP to keep its policy rates steady during last week’s policy rate setting meeting. Now moving on to an area, which I know everyone has a keen interest in – the peso.