Thursday, June 14, 2012

Philippines keeps key rate steady at 4 pct

    The central bank of the Philippines left its key policy rate unchanged at 4 percent as inflation expectations remain firmly anchored amidst an improving domestic economy.
    The monetary board of Bangko Sentral ng Pilipinas said in a statement that the latest forecasts call for inflation to remain in the lower half of the bank's 3-5 percent target range for 2012 and 2013 and a weak global economy could further dampen oil and commodity prices in coming months.
    "On balance, therefore, the Monetary Board believes that the benign inflation outlook and robust domestic growth provide adequate room to keep policy rates unchanged, especially as the cumulative 50-basis-point reduction in policy rates and the operational adjustments in the reserve requirements earlier in the year work their way through the economy," the bank said.
    The Philippine central bank cut its main policy rate by 25 basis points in March after trimming the rate by the same amount at its January meeting.
    The bank's key policy rate is the overnight borrowing, or reverse repurchase facility (RRR), which was maintained at 4 percent, while the overnight lending, or repurchase facility (RR) was left at 6 percent.


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