(Bloomberg) — The Philippine central bank raised its benchmark interest rate for a fifth straight meeting to curb inflation, joining Indonesia in tightening monetary policy on Thursday.
Bangko Sentral ng Pilipinas increased the overnight reverse repurchase rate to 4.75 percent from 4.5 percent, the highest since 2009, it said in a statement in Manila. Policy makers have delivered 175 basis points of rate hikes since May, among the most aggressive tightening action in Asia.
Key Insights
- Eleven of 19 economists surveyed by Bloomberg predicted the decision, as inflation remains at a nine-year high. The rest forecast no change
- Inflation was 6.7 percent in October. The central bank’s target is for annual inflation to average 2 percent to 4 percent until 2020. While prices of oil and rice have eased, pressure remains after higher wages and transport costs in Manila were approved recently
- The prospect of higher rates in the U.S. adds to risks of financial market volatility and capital outflows. While the peso is still down more than 5 percent this year, it has recovered recently and is among the best performers in emerging markets in the past month
Get More
- President Rodrigo Duterte’s record spending on roads and railways helped shield the economy from the impact of rising prices and higher borrowing costs. Growth held at more than 6 percent in the third quarter, still among the fastest in the world
Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.
Source: Investing.com
