Money in Philippines
Philippines - Money
Central Bank keeps rates unchanged in August
At its 20 August monetary policy meeting, the Central Bank of the Philippines (BSP) decided to leave the overnight reverse repurchase facility at 2.25%. Accordingly, the overnight deposit facility and the overnight lending facility rates—which establish the floor and the ceiling of the interest rate corridor—were kept stable at 1.75% and 2.75%, respectively. This came after four consecutive rate cuts earlier this year to buttress the economy.
The decision to stay put was likely driven by a desire to take stock of past easing, as rates are already at record lows. As the BSP stated in its press release: “A prudent pause will enable the cumulative 175-basis-point reduction in the policy rate as well as other monetary and regulatory relief measures by the BSP to fully work their way through the economy.”
The Bank did not give explicit guidance on the direction of monetary policy going forward, but reiterated it “remains committed to deploying its full range of monetary instruments and regulatory relief measures as needed”. Our panelists are split: while several see rates unchanged through end-2020, others see additional easing to spur activity.
Nicholas Mapa, senior economist at ING, is among the analysts who see rates unchanged:
“Monetary authorities will likely hold off on further rate cuts in 2020 and look to fiscal stimulus to complement the flurry of moves from the BSP to jump start economic growth.”
Makoto Tsuchiya, economist at Oxford Economics, has a different view:
“Barring an unexpected shock to inflation, the BSP is likely to loosen monetary policy further through both RRR and policy rate cuts in order to provide more support to the economy.”
FocusEconomics panelists see the policy rate ending 2020 at 2.10% and 2021 at 2.17%.
Philippines - Money Data
|Money (annual variation in %)||9.1||13.3||11.6||8.6||10.9|
5 years of economic forecasts for more than 30 economic indicators.
Philippines Money Chart
Source: Central Bank of the Philippines.
|Bond Yield||4.44||-4.11 %||Dec 27|
|Exchange Rate||50.66||0.02 %||Jan 01|
Get a sample report showing our regional, country and commodities data and analysis.
Request a Trial
Start working with the reports used by the world’s major financial institutions, multinational enterprises & government agencies now. Click on the button below to get started.
September 16, 2020
Remittances totaled USD 2.8 billion in July (June: USD 2.5 billion), representing a 7.8% year-on-year rise and likely supported by the lifting of lockdowns abroad.
September 10, 2020
Merchandise exports plummeted 9.6% year-on-year in July amid lower exports of gold and machinery, following June’s 12.5% decline.
September 4, 2020
Consumer prices fell a seasonally-adjusted 0.16% in August over the previous month, contrasting the 0.49% increase logged in July.
Philippines: Manufacturing sector conditions deteriorate at faster pace in August amid fresh lockdown measures
September 1, 2020
The manufacturing Purchasing Managers’ Index (PMI), produced by IHS Markit, fell from 48.4 in July to 47.3 in August due to stricter Covid-19 restrictions.
August 20, 2020
At its 20 August monetary policy meeting, the Central Bank of the Philippines (BSP) decided to leave the overnight reverse repurchase facility at 2.25%.