Bangko Sentral ng Pilipinas: Policy Unchanged but…

September 12, 2013

The Monetary Board, whose statement after the prior policy meeting in July had explicitly called the existing stance “appropriate,” did not make a similar claim in today’s statement.  Instead, “the Monetary Board noted that the balance of risks to the inflation outlook has shifted slightly toward the upside as oil prices have become more volatile amid ongoing geopolitical tensions in the Middle East.”  To be sure, the baseline forecast has inflation lying within the 3-5% target range this year and next and within a reduced target of 2-4% in 2015.  The Filipino 3.5% reverse repo rate and 5.5% repo rate have been at those levels since the last of four 2012 cut made in October.  Earlier reductions occurred in January, April and July.  This year saw three cuts of 50 bps each in the Special Deposit Rate in January, March and April.  Domestic economic activity in the Philippines remains solid.

Copyright 2013, Larry Greenberg.  All rights reserved.  No secondary distribution without express permission.



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