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The BSP's main responsibility is to formulate and implement policy in the areas of money, banking and credit with the primary objective of preserving price stability. Price stability refers to a condition of low and stable inflation. By keeping price stable, the BSP helps ensure strong and sustainable economic growth and better living standards.
 
 

Monetary Policy

The primary objective of the BSP's monetary policy is to promote a low and stable inflation conducive to a balanced and sustainable economic growth.

Inflation Targeting

 

Inflation targeting is the BSP’s way of conducting monetary policy to achieve its primary objective of price stability. The BSP adopted the inflation targeting framework in January 2002.

The Inflation Target

Monetary Policy Decisions

 



Calendar of Policy Meetings

 

The Monetary Board holds monetary policy meetings eight (8) times a year, with meeting intervals of six (6) to eight (8) weeks, to deliberate, discuss, and decide on the appropriate monetary policy stance of the BSP in order to keep inflation within the target

The Advisory Commitee

Highlights of MB meetings on monetary policy

 

Consistent with the disclosure and reporting mechanisms under the Inflation Targeting framework, the BSP publishes the highlights of the meetings of the Monetary Board on monetary policy to help the public gauge the BSP's commitment to achieve the inflation target.

Open Letter to the President

 

To ensure accountability in cases where the BSP fails to achieve inflation target, the BSP Governor issues an Open Letter to the President outlining the reasons why actual inflation did not fall within the target, along with the steps that will be taken to bring inflation towards the target. Open Letters to the President have been issued on 16 January 2004, 18 January 2005, 25 January 2006, 19 January 2007, 14 January 2008, 26 January 2009, 28 January 2016, 27 January 2017 and 25 January 2019

 
The BSP was able to achieve its inflation target from 2009 to 2014, 2017, 2019, and 2020. For this reason, no Open Letters were issued for this period.

Inflation Report

 

The Inflation Report is published quarterly as part of the BSP's trasparency mechanism under inflation targeting and to convey to the public the overall thinking and analysis behind the BSP's decision on monetary policy.

Press Release | Full Report | Archives | Inflation Report - Infographics

Monetary Operations

Monetary operations refer to the implementation of monetary policy. To ensure that the monetary policy decision is transmitted to the financial market and the economy in general, the BSP uses its suite of monetary instruments to influence the underlying demand and supply conditions for central bank money. Read more

Monetary Operations under the Interest Rate Corridor Framework

Overnight Reverse Repurchase Facility

 

The RRP facility is the primary monetary instrument of the BSP. The RRP interest rate signals the policy rate of the BSP.

The overnight RRP is offered using a fixed-rate and full-allotment method.

Auction Schedule | O/N RRP Rate

Issuance of BSP Securities

 

BSP Securities are monetary instruments issued by the BSP for its monetary policy implementation and liquidity management operations to steer short-term market interest rates towards the policy rate and influence liquidity conditions in the financial system.

Auction Schedule | Auction Result | Historical Excel

Term Deposit Facility

 

The TDF is a key liquidity absorption facility, commonly used by CBs for liquidity management. Currently, three tenors— 7 days, 14 days and 28 days—are offered in weekly auction.

Auction Schedule | Auction Result | Historical Excel

Standing Liquidity Facilities

 

These standing overnight facilities (lending and deposit) are available on demand to qualified counterparties during BSP business hours in order to help them adjust their liquidity positions at the end of the day.

 

The two standing facilities that form the upper and lower bound of the corridor are set at ± 50 basis points (bps) around the target policy rate (the overnight RRP rate under the new IRC structure).​

OLF Rate | ODF Rate