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BSP seen to raise rates before midyear
An economist advises the Bangko Sentral ng Pilipinas (BSP) to increase its benchmark interest rate in the second quarter to combat rising inflation, driven by soaring global oil prices due to the Russia-Ukraine conflict.
CLSA Senior Economist Anthony Nafte predicts Philippine inflation could spike to between 5.5% and 6% in the coming months, more than double the current rate of 3%.
He anticipates a 25-basis-point rate hike before mid-2022, followed by another 50-basis-point increase in the latter half of the year.
Finance Secretary Carlos G. Dominguez III stated that the Philippine economy might suffer 'collateral damage' from the Russia-Ukraine crisis, leading to price increases across various sectors.
BSP Governor Benjamin E. Diokno acknowledged that the conflict and its impact on international oil prices could cause inflation to exceed the central bank's 2% to 4% target this year.
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The Bangko Sentral ng Pilipinas (BSP) is closely monitoring inflation risks stemming from the Russia-Ukraine conflict, which has led to increased global crude oil prices.
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The Philippine peso weakened past P52 to a dollar, its lowest point since 2019, due to escalating global oil prices amid the Russia-Ukraine conflict.
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The Bangko Sentral ng Pilipinas (BSP) supports the national government's fiscal interventions to mitigate the economic impact of the Russia-Ukraine conflict.
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Headline inflation remained steady at 3.0 percent in February, unchanged from January's rate, as slower food price increases counteracted rising oil costs.
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