Bangko Sentral ng Pilipinas to Raise Rate

By Michelle Remo
Philippine Daily Inquirer

The Bangko Sentral ng Pilipinas has hinted it might soon raise its key policy rates, saying that while current price movements were still favorable, the buildup of inflationary pressures was reducing its flexibility to keep rates at historic lows.

“Indeed the scope for keeping rates has narrowed,” BSP Governor Amando Tetangco Jr. told reporters on Wednesday.

The policy rates stand at record lows of 4 percent for overnight borrowing and 6 percent for overnight lending. The rates have been at these levels since July 2009.

Tetangco said, however, that the central bank was prepared to adjust rates and would do so as soon as such a move would be proven necessary. “The BSP will make further adjustments to policy as and when necessary,” Tetangco added.

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