BSP signals rate pause as easing cycle winds down
The Bangko Sentral ng Pilipinas (BSP) could keep its policy rate unchanged through the end of the year if inflation remains subdued and demand holds up, Governor Eli Remolona Jr. said.
In an interview with Bloomberg TV on Friday, Remolona signaled that the central bank’s easing cycle is nearing its end.
Still, he left the door open to further easing, saying the Monetary Board could consider another reduction later this year if demand shows signs of weakening.
On Thursday, the BSP slashed the overnight borrowing rate by a quarter point to 5 percent, a level that Remolona described as the “Goldilocks” level—neither inflationary nor restrictive to economic growth.
In a note to clients, Nomura Global Markets Research said the BSP is approaching the end of its rate-cutting phase, “barring a major shock.”
