Economy6d ago·29 sources
Bar for Another Rate Cut is High, Philippine Central Bank Governor Says
Philippine central bank Governor Eli M. Remolona Jr. stated that the Bangko Sentral ng Pilipinas (BSP) still has room to cut interest rates, as inflation remains within the target range and the economy is on a firmer footing. However, he cautioned that it is too early to declare victory due to uncertainties, particularly those stemming from potential US policy changes under Donald Trump, such as tariffs. The BSP has already cut rates by a total of 75 basis points last year. While the BSP monitors the US Federal Reserve's actions, its own monetary policy decisions are data-dependent. Analysts from BMI, a unit of Fitch Solutions, anticipate the BSP's pace of easing may slow due to a more hawkish Fed and policy uncertainty in the US, projecting fewer rate cuts than previously expected. They also noted that the peso's stability is a consideration, though the BSP might prioritize economic growth over currency stability in extreme scenarios. Inflation is expected to remain within the BSP's target range for 2025.