Saturday, 10 May 2025, 6:43 pm

    Remolona: Trade shocks tougher to tame than supply disruptions

    Bangko Sentral ng Pilipinas (BSP) governor Eli M. Remolona, Jr. warned that trade shocks pose a deeper challenge to economic stability than typical supply shocks, citing their longer-lasting effects on investment and growth. 

    Speaking at the IMF-World Bank Spring Meetings in Washington D.C., Remolona said that while supply disruptions often fade, current trade shocks are “sticking around” and undermining capital formation in developing economies due to import reliance on investment goods. 

    “Monetary policy doesn’t have the tools for that kind of shock,” he admitted, highlighting the limits of central banks in countering trade-related disruptions. 

    The BSP chief also noted that easing inflation gives the central bank more leeway, following its April rate cut to 5.5 percent. Remolona led the Philippine delegation in meetings with global financial leaders, credit agencies, and investors, reinforcing the country’s commitment to monetary stability amid global uncertainty.

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