THE CENTRAL BANK will ensure ample liquidity and the stability of the banking system through its policy actions, an official said.
“On the monetary policy side, we need to hold firm. We need to ensure that liquidity continues and the banking system is safe,” Monetary Board member V. Bruce J. Tolentino said at a lecture held during the virtual signing of a memorandum of agreement for a research partnership among the Bangko Sentral ng Pilipinas (BSP), the Ateneo de Manila University, and the University of the Philippines Diliman.
He said the central bank will also looking at ways to address supply issues that caused elevated inflation.
Inflation last year averaged 4.5%, higher than the 2.6% in 2020 and above the 2-4% target of the central bank.
For 2022 and 2023, the central bank expects inflation to stay within target at 3.4% and 3.2%, respectively.
The BSP kept benchmark interest rates at record lows in 2021, citing the need to support the economy amid new coronavirus disease 2019 variants.
BSP Governor Benjamin E. Diokno has said they are unlikely to adjust borrowing costs in the first semester as they want to see at least four to six consecutive quarters of growth before any policy moves.
The Monetary Board will have its first policy review for this year on Feb. 17.
Amid a continued shortage in pork, Mr. Tolentino said they support permanently lowering tariffs for these products to help bring down prices. The government last year temporarily raised the pork import quota to address low supply that has caused higher prices of meat, which was in effect until the end of 2021.
“There is a case now for making these reductions in tariffs as well as the increase in the minimum access volume permanent. This is because Filipinos need the food that they need at a lower cost in order for the cost of living to be well managed,” he said.
“In order to extend that or make it permanent, it requires another executive order, or it requires legislation. I’m hoping that such legislation will be enacted, particularly for livestock, through the new livestock bill that’s now being considered,” Mr. Tolentino added. — LWTN