BSP cuts key rates despite January inflation uptick

The Bangko Sentral ng Pilipinas (BSP) cut key policy rates on February 6, reducing the overnight borrowing rate to 3.75%, overnight lending to 4.25%, and overnight deposit to 3.25%.

Despite an uptick in January's inflation rate to 2.9%, within the BSP’s forecast range of 2.5-3.3 percent, market watchers expected this move.

BSP Governor Benjamin Diokno stated that inflation expectations remain anchored within the target range and that the central bank expects inflation to settle at 3.0% for the year.