Eli Remolona has forged quite a path as an economist and policy maker. He got his Ph.d at Stanford University where John “Taylor Rule” Taylor was one of his professors. He has had extensive policy and operational experience in monetary policy and international finance having worked for 19 years at the Bank for International Settlements as regional head for Asia and the Pacific and 14 years for the Federal Reserve Bank of New York.
Now he is governor of the Bangko Sentral Ng Pilipinas, which makes him the Fed Chair Jay Powell of his country. Notably however he put the BSP out in front of the Fed by leading it to make its pivot to cutting rates on August 17, a month ahead of the Fed. Governor Remolona sat down with me at the IMF and World Bank annual meetings this week and told me what drove the BSP to get on the rate cutting path ahead of the Fed in August.
”We weren’t trying to be first, we just followed the data. And the data said that inflation is under control and we're beginning to cause some loss of output. So we've started a cutting cycle and the easing cycle… we'll do it in baby steps. But I think we're we're confident that it's a good time to be easing.”
The inflation rate is down to 1.9% year-over-year from a peak of 8.7%, below the bottom of the BSP’s 2% to 4% range, keepin the BSP door is now wide open to more rate cuts.
‘The data for now is telling us that we have room for a few more rate cuts, I'd say we're doing it in baby steps (one) 25 at a time,” Remolona says.
In fact, he told me as we wrapped that expects another one at the BSP’s final meeting of the year!
”So the next meeting is just before Christmas,” he adds, “I think based on the data we're seeing now, it should be another 25 basis points.”
Don’t take my word for it. Dive in and hear what he has to say. We covered much more in this wide-ranging interview, starting with the devastation caused by severe tropic storm Trami that left at least 82 dead, a painful reminder of the Philippines’ vulnerability to climate change. As for the economy now and in the future, we looked at where it is now and the policies in place to encourage investment in what he sees as the Philippines bright economic future.
Dr. Eli Remolona, Jr. is the seventh Governor of the BSP and Chairman of the Monetary Board.
Governor Remolona has extensive policy and operational experience in monetary policy and international finance having worked for 19 years at the Bank for International Settlements and 14 years for the Federal Reserve Bank of New York.
From 2019 to 2022, Governor Remolona served as professor of finance and director of central banking at the Asia School of Business in Kuala Lumpur. Additionally, he also taught at Williams College, Columbia University, New York University, and the University of the Philippines-School of Economics.
Before his appointment to the Monetary Board in 2022, Governor Remolona served as an independent director of the Bank for Philippine Islands (BPI) and chairman of its risk management committee.
He earned his PhD in Economics with distinction from Stanford University and obtained his bachelor’s degree in Economics with honors from the Ateneo de Manila University.
.
Philippines Central Bank Governor Sees Another 25bps Rate Cut in December