BSP rate cuts unlikely this year

MANILA, Philippines — The Bangko Sentral ng Pilipinas is unlikely to slash interest rates this year as domestic inflation is still not low enough to warrant a rate cut, according to foreign economists.

Inflation averaged 3.5 percent in the first five months, still within the BSP’s two to four percent target, despite rising to a six-month low of 3.9 percent in May. BSP Governor Eli Remolona Jr. earlier said the central bank could cut rates by 25 or 50 basis points this year, possibly as early as August, depending on the data.

“We expect the Philippine central bank to keep the benchmark rate at a 17-year high of 6.50 percent this week, with restrictive plans to keep inflation in check as well as support the currency,” they said. The Metro Pacific Group is looking for an investor who can finance the P7-billion expansion that would improve the traffic...

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