BSP eyes up to two policy rate cuts in H2

Bangko Sentral ng Pilipinas (BSP) Governor Eli Remolona Jr. indicated that up to two more policy rate cuts are possible within the second half of the year.

He cited the current low inflation and slightly weaker economic growth as reasons for the BSP's flexibility to implement further monetary easing.

The central bank has three remaining policy meetings in August, October, and December where such decisions can be made.

This possibility comes after the interagency Development Budget Coordination Committee (DBCC) lowered its 2025 GDP growth target to a range of 5.5 to 6.5 percent, from the previous six to eight percent.

Governor Remolona described the revised growth assumption as 'more realistic', noting that the slowdown is largely driven by postponed big-ticket purchases, investment decisions, and weaker exports amid sluggish global growth.

He also cautioned that these potential rate cuts can't entirely make up for the slowdown in growth.