The BSP likewise reiterates its support for carefully coordinated efforts with other government agencies in implementing non-monetary measures to help mitigate the impact of supply-side factors on inflation and social welfare. Accordingly, the BSP will sustain its utmost vigilance. In particular, we are taking into account the potential price pressures of excessive volatility in the foreign exchange market.
While we believe that our fundamentals remain solid and healthy, sustained pressures on the peso could adversely affect inflation expectations. Further, some demand side pressure may also be already feeding into inflation. All of these warrant a firm and timely monetary response.