Ironically, this leads to an apparent breakdown of the historically-proven quantity-theoretic relationship between real activity and money stock.10 Moreover, not only is the policy rate very low, but so too are longer risk-free rates, judged by historical standards. Conventional monetary policy through the overnight policy rate is not as effective as before, and this means the economy is more vulnerable to a downside shock.
The increasing interdependencies of banking, telecommunications, and information technology, pose a challenge for BSP to continuously adapt to a rapidly evolving technological and business environment. Nevertheless, with the support and cooperation of all stakeholders, such as Globe and Innove….I am confident our vision of a globally competitive financial industry will be realized, eventually.