BSP expects steady interest rates

Metro Manila (CNN Philippines, September 15) — The Bangko Sentral ng Pilipinas (BSP) expects unchanged interest rates at the Monetary Board policy meeting next week, following the dissipation of supply shocks from food and oil prices due to August's hot inflation.

"It's food prices and oil that caused the uptick but these kinds of supply shocks, they dissipate usually fairly quickly," BSP Governor Eli Remolona said.

"So, if that's all there is, if there are no further supply shocks beyond that uptick in August, then it won't be necessary to hike the policy rate," he also said.

Remolona added that it won't justify an easing of interest rates but it also won't be necessary to raise the policy rate.

September 21 marks the sixth policy review this year by the Monetary Board, and the first time that new members — former Finance Undersecretary and banker Romeo Bernardo and National Treasurer Rosalia de Leon — would be joining the board following their appointments.

The Monetary Board has so far hiked interest rates by 425 basis points to 6.25% from May last year to March 2023, but put the brakes on those hikes in the last three policy meetings.