Thursday, March 24, 2011

Philippine Central Bank Hikes Rate 25bps to 4.25%

The Bangko Sentral ng Pilipinas raised its benchmark overnight borrowing or reverse repurchase (RRP) facility rate by 25 basis points to 4.25% from 4.00%, and the overnight lending or repurchase (RP) facility rate 25 basis points to 6.25%. The rate increase was driven by "signs of stronger and broadening inflation pressures as well as a further upward shift in the balance of inflation risks". The Bank also noted that " The latest baseline inflation forecasts now indicate that the 3-5 percent inflation target range in 2011 could be at risk.". Philippine inflation accelerated to a 9-month high of 4.3% in February due to higher food and energy commodity prices, as well as fares and utilities.


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