Manila Bulletin
BSP open to more rate cuts
The Bangko Sentral ng Pilipinas (BSP) has reduced its policy rates by 75 basis points this year to support economic growth amidst the COVID-19 pandemic.
The central bank is open to further interest rate cuts, potentially another 50 basis points, to offset the damage from the COVID-19 lockdown.
The BSP forecasts average inflation for 2020 to be 2.2% and for 2021 to be 2.4%, citing lower global oil prices and the pandemic's impact on global and domestic growth.
The BSP is prepared to use its full range of monetary instruments and regulatory relief measures, including recalibrating interest rate corridor settings and suspending term deposit facility auctions, to ensure price and financial stability.
A combination of health, fiscal, and financial market measures will be crucial in limiting the economic fallout from the pandemic, with the BSP noting the National Government has ample fiscal space.
The BSP anticipates a U-shaped economic recovery, with the impact of COVID-19 lasting until the second half of 2020, followed by a rebound in 2021.
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The Bangko Sentral ng Pilipinas (BSP) is prepared to utilize all available policy tools to support economic growth amidst the coronavirus outbreak.
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