Medalla hints at continued rate hike pause

FILE PHOTO: Bangko Sentral ng Pilipinas Governor Felipe Medalla poses for a photograph in his office at Manila, Philippines, November 18, 2022. REUTERS/Eloisa Lopez

MANILA  -Bangko Sentral ng Pilipinas (BSP) Governor Felipe Medalla hinted at a continued pause on policy rate hikes this week, saying that the downtrend on inflation across the Philippines could justify this.

Medalla told reporters that at the rate things were going, keeping the BSP’s benchmark rate unchanged for the second policy meeting in a row on June 22 appeared to be the best strategy.

The rate of increase in prices of goods and services that households commonly purchase had decreased continually from 8.7 percent in January to 6.1 percent in May.

PH inflation rate for May 2023 slows down further to 6.1%

The BSP chief reiterated that the monthly readout should be less than 4 percent before the end of this year, and that inflation should be more or less 3 percent by next year.

“Now of course we know from experience that something can happen that makes the actual inflation lower or higher,” Medalla said.

Private-sector analysts—including those at ING Bank, Goldman Sachs, Rizal Commercial Banking Corp., Security Bank Corp. and Pantheon Macroeconomics—are also expecting the BSP’s Monetary Board to keep the policy rate unchanged this week.

State economic managers have also reiterated that while inflation had eased for the fourth straight month in May, El Niño remained a major concern that the government is addressing.

Marcos’ economic team wary of El Niño impact on inflation

In the Philippines, the climate phenomenon increases the chance of lower than normal rainfall conditions, which could lead to dry spells and droughts in some areas of the country.

El Niño is expected to develop in the next couple of months, with a higher chance of persisting up to the first quarter of 2024. INQ



Your subscription could not be saved. Please try again.



Your subscription has been successful.


Read Next

Don’t miss out on the latest news and information.

Subscribe to INQUIRER PLUS to get access to The Philippine Daily Inquirer & other 70+ titles, share up to 5 gadgets, listen to the news, download as early as 4am & share articles on social media. Call 896 6000.

For feedback, complaints, or inquiries, contact us.

For all the latest Business News Click Here 

 For the latest news and updates, follow us on Google News

Read original article here

Denial of responsibility! TheDailyCheck is an automatic aggregator around the global media. All the content are available free on Internet. We have just arranged it in one platform for educational purpose only. In each content, the hyperlink to the primary source is specified. All trademarks belong to their rightful owners, all materials to their authors. If you are the owner of the content and do not want us to publish your materials on our website, please contact us by email – [email protected] The content will be deleted within 24 hours.