Philippine Central Bank Governor Is Recovering From Cancer

(Bloomberg) -- Philippine central bank Governor Nestor Espenilla said he's recovering from early stage tongue cancer diagnosed in November, assuring that it won't distract him from work.

“My doctors say I'm now cancer-free,” Espenilla, 59, said in a mobile-phone message to reporters from Jerusalem, where he's on pilgrimage with his wife and friends. The governor said he had surgery soon after finding out about the cancer which he described as “very early stage and quite localized.”

Espenilla said that “for insurance” he also went through radiation therapy, which caused speaking difficulties due to dry throat and mouth sores. These problems will be resolved in time and doctors expect full recovery in a month or so, he said.

“So I don't expect this curve ball to slow me down,” said the governor, who's seven months into the job. “I just have to hang on and be patient. Meanwhile, it's work as usual for me. Onward with the financial market reforms,” he said.

Finance Secretary Carlos Dominguez said Espenilla, fondly called Nesting by friends and colleagues, enjoys his full support and that of President Rodrigo Duterte.

“The good news is that our prayers have been answered and that Nesting is cancer-free and recovering from the ill effects of the treatment,” Dominguez said in a text message.

Before revealing his health condition, Espenilla devoted a third of his written comments to assuring that the central bank's decision to cut the reserve requirement ratio amid rising prices won't fuel more inflation. He warned foreign-exchange speculators that the monetary authority is selling dollars from its reserves.

Fears Unfounded

“That in itself also has the effect of draining peso liquidity from the system, which causes a self-correction,” he said. “Analyst fears of ensuing looser monetary policy that can fuel more inflation is really unfounded.”

The Philippine peso is the second-worst performing emerging market currency this year after the Argentine peso. It has lost 3.8 percent.

Espenilla, who said last week that an interest-rate hike remains on the table amid the fastest inflation since 2014 in January, said the central bank can also use the term deposit rates to signal monetary policy stance. He said this while reiterating that the reserve ratio cut shouldn't be interpreted as easing.

“If BSP wants to change the monetary policy stance, BSP will signal that overtly, by changing the policy rate (reverse repurchase rate or RRP),” Espenilla wrote, referring to Bangko Sentral ng Pilipinas. “But it can also do that more subtly without necessarily changing the RRP rate, by allowing the market-determined TDF rates to rise (or fall) by altering auction volumes.”

To contact the reporter on this story: Clarissa Batino in Manila at cbatino@bloomberg.net.

To contact the editors responsible for this story: Bernard Kohn at bkohn2@bloomberg.net, Stanley James at sjames8@bloomberg.net, Kenneth Pringle

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