The Philippines' peso has tumbled to a fresh 11-year low, but the country's policymakers said that heralded good tidings.
Nestor Espenilla, governor of the country's central bank, Bangko Sentral ng Pilipinas, or BSP, said he wasn't worried about either the deficit or the currency's drop — or even his expectation that the peso may fall further.
The Philippine currency has been the worst performing in Asia this year, with the U.S. dollar rising around 3.7 percent against the peso. In contrast, the peso's peers have generally gained against the greenback.
The dollar was fetching 51.159 pesos at 10:27 a.m. HK/SIN on Tuesday. Analysts have blamed the weakness on the country's current account deficit, which is when the value of a country's total imports exceeds its total exports. The difference between the two figures often must be financed by debt.
"The Philippines is an emerging market that's growing quite fast. It's natural for such a market to have a current account deficit," Espenilla told CNBC's "Squawk Box" on Tuesday. "What's important is the quality of that deficit. If you look underneath the numbers, it's actually capital goods imports that are behind it. And this is going to improve productive capacity of the economy further."