Philippines holds rate at 3%, deems inflation outlook as ‘manageable’

By Susanna Moon

Chicago, Aug. 11 – Bangko Sentral ng Pilipinas’ monetary board decided to keep the interest rate unchanged at 3% on its overnight reverse repurchase facility at its meeting Thursday.

“The decision is based on its assessment that the inflation environment remains manageable,” according to a bank notice.

Inflation is likely to end up slightly below the 3% plus or minus 1% target range in 2016 and climb to the center of the range in 2017 and 2018, the bank predicted.

The risks to the inflation outlook remain “broadly balanced,” the bank said, with upside risks rising from pending petitions for adjustments in electricity rates and the key downside risk continuing to be the slower global economic activity.

At the same time, the “prospects for global economic growth have remained subdued since the previous meeting,” the bank added.

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