Philippine central bank chief signals more rate hikes as needed
MANILA — The Philippine central bank is prepared to do whatever necessary to contain inflation, its governor said on Friday, leaving the door wide open to more interest rate hikes after the bank delivered a 25-basis-point increase a day earlier.
“The market needs to understand that we will do what is necessary to contain inflation,” Governor Eli M. Remolona, Jr. said in an interview with Bloomberg TV. “At the moment, that seems like a succession of modest rate hikes.”
The Bangko Sentral ng Pilipinas raised its key policy rate by 25 basis points to 4.50% on Thursday, ending its easing cycle.
Mr. Remolona said the economy would likely grow between 4.5% to 4.6% this year, slightly better than an earlier projection of 4.4%, but still below the government’s 5.0% to 6.0% target in 2026.
“Our potential is much higher than our forecast,” Mr. Remolona said.
Supporting the Philippines’ consumption-driven economy is the steady flow of remittances, which Mr. Remolona said remained resilient despite the conflict in the Middle East where over two million Filipinos are living and working. — Reuters
