BSP chief: Fiscal stimulus better than monetary for Covid-19 impact

Bangko Sentral ng Pilipinas (BSP) Governor Benjamin Diokno stated that fiscal stimulus is more effective than monetary stimulus in addressing the economic impact of Covid-19 on the Philippine economy.

Diokno explained that monetary stimulus may be less effective if people are staying home and consequently not spending money.

He believes the government's infrastructure program, "Build, Build, Build," will be a more effective countermeasure against any potential slowdown in domestic growth.

However, Diokno also mentioned that a policy rate cut may still be considered this year.

The government targets gross domestic product (GDP) growth of 6.5-7.5% this year, coming from a 5.9% expansion in 2019.

Economic managers have said GDP growth could take a hit from the virus, with the extent of the impact dependent on how long the outbreak persists.