Bangko Sentral ng Pilipinas: Reverse Repo Rate to Stay at 3.0%

August 11, 2016

The overnight lending and deposit rates in The Philippines were left unchanged at 3.5% and 2.5%, a corridor that straddles the reverse repo rate of 3.0%. The narrow rate band replaced a wider 4-6% corridor that had been maintained since a 25-basis point hike in September 2014. There was also a 25-bp increase in July 2014, no changes in 2013, and four cuts during 2012. A statement today calls inflation “manageable.” The central bank CPI target is 2.4%. Inflation is projected to stay below the target range for the balance of this year but to hover near its mid-point in 2017-18. Monetary officials consider the current interest rate structure and the unchanged reserve requirement “appropriate” given the inflation outlook and proliferation of external uncertainties.

Copyright 2016, Larry Greenberg.  All rights reserved. No secondary distribution without express permission.

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