Philippine Rate Cut Coming In Q3

last updated on

Philippine Rate Cut Coming In Q3

Philippine'S Central Bank Says Rate Cut Is Coming In Q3

According to the Philippines's central bank, the interest rate cut scheduled for Q3 2024 is still on the cards. This comes at a time when inflation is picking pace, and consumer prices are turning higher.

The governor of the central bank made it clear that they will ease the monetary policy during the Q3 (Jul-Aug-Sep). However, he also added that the fate of the rate cut will be tied to the upcoming economic data.

As for the inflation situation, Remolona added that they are happy with it. However, they also added that there are certain risks associated with it. But that's not a problem, as the Philippines's central bank is taking measures against these risks.

Philippines'S Interest Rate At 17-Year High

In the Philippines, the interest rate is at 6.50%, a 17-year high which signifies that the central bank is really serious about taming the inflation.

In January 2023, the interest rate was near 8.7, the highest level in 14 years, but it has since come down after the rate cuts. Now, it seems that the Philippine central bank is gearing up to cut rates further in the coming months.

Meanwhile, the Philippine's central bank also hinted that they are less hawkish now as compared to the last. As for the monetary policy, it will still remain tight despite the upcoming rate cuts.

So, if the BSP actually goes ahead with a rate cut in Q3, it will put it ahead of the US Fed, BoE, and several other central banks.

In the USA, the stronger-than-expected job market continues to give more headroom for the Fed to delay the rate cuts. But despite all the optimism, the central bank will still cut the rates before the 2024 ends.

According to the governor of BSP, they don't have any specific level for the exchange rate of the local currency. That's why the central bank will only intervene in case of a dysfunction.

Trending Stories