Philippine central bank governor Eli Remolona Jr. — Bloomberg
MANILA: There are persistent price pressures that have yet to dissipate and could still pose a risk to the inflation outlook, a situation that might prompt the Bangko Sentral ng Pilipinas (BSP) to delay its rate cuts, says governor Eli Remolona Jr.
Speaking to reporters on Wednesday, Remolona said that while inflation is projected to stay within the 2% to 4% target range of the BSP this month, hitting pause at the Dec 19 meeting of the policymaking Monetary Board is still on the table depending on the data.
On the flip side, the weaker-than-expected economic growth in the third quarter might prompt the BSP to unleash a third rate cut next month, he added.
“Our readings show there are still some slight pressures on inflation,” the central bank chief said.
“Inflation pressures may cause us – maybe – to pause a bit. But weak growth may cause us to cut,” he added.
The central bank entered its easing era last August with a 25-basis-point (bps) reduction to the benchmark rate.
In October, the BSP further trimmed the policy interest rate by a quarter point to its current level of 6%.
While an easing delay is possible, Remolona had stressed that the central bank is still on its “gradual” rate cutting cycle.
Overall, the BSP boss said cumulative rate cuts worth 100 bps are possible next year. — The Inquirer/ANN
