BSP has room to cut rates amid stable inflation

The country's stable inflation rate of 2.9 percent in January provides the Bangko Sentral ng Pilipinas (BSP) with flexibility to further decrease interest rates, according to Finance Secretary Ralph Recto.

Recto stated that lower interest rates will reduce borrowing costs for consumers and businesses, thereby enhancing purchasing power and investment momentum.

This stable inflation follows a slower-than-expected gross domestic product (GDP) growth of 5.6 percent in 2024, which missed the government's revised target.

The Philippines recorded its highest employment rate in 19 years in 2024, with approximately 50 million Filipinos securing jobs.

Last year, the BSP's Monetary Board implemented a total reduction of 75 basis points in policy rates, and their next monetary policy meeting is scheduled for February 13.

The government remains committed to implementing measures aimed at maintaining stable prices for essential goods, particularly rice.