MANILA, July 17 (Reuters): The Philippine central bank has announced that it was not ruling out another rate hike in August after it delivered an off-schedule 75 basis point rate increase to combat inflation.
When asked if the central bank was still looking at further raising rates at its meeting on Aug. 18, Bangko Sentral ng Pilipinas (BSP) Governor Felipe Medalla (pic) said in a phone message "may or may not."
But Medalla reiterated the central bank will be "data dependent".
Also when asked if a 50 basis point increase was possible in August, he said: "Can't say 50 for sure."
The BSP has raised policy rates by a total 125 basis points so far this year, joining peers around the world in a rush to tame inflation and stem weakness in their currencies.
The peso has fallen 9.45% against the dollar, making it the worst performing currency in the region.
The peso's decline has drawn concerns from authorities that it could dampen consumer demand via higher food and fuel prices.
"With inflation expected to sustain its ascent, we believe BSP will be busy at the next few policy meetings as well," ING economist Nicholas Mapa said in a note.
"We expect BSP to hike again at least one more time in 3Q with the possibility of further tightening should inflation continue to remain stubbornly high," Mapa said.
Philippine annual inflation has averaged 4.4% in the first six months of the year, outside the central bank's 2%-4% comfort range. - Reuters
