Philippine central bank to keep rates at a record low as the economy remains in recession

The Philippine central bank is expected to keep its benchmark interest rate at a record low amidst the country’s projected slow recovery from the recession due to pandemic and steady inflation last month.
In a Reuters poll, all 13 economists surveyed predicted the BSP will keep the rate on its overnight reverse repurchase facility at 2 percent for a fourth straight meeting.
“We expect the BSP to remain on hold … with the central bank likely noting the appropriateness of current monetary policy settings as the country battles the ongoing wave of (COVID-19) infections,” J.P. Morgan economists said in a note.
The surge of coronavirus cases in March has forced the Philippine government to reimpose more stringent measures in the capital region, where 13 million people in 16 cities and the account for 40% of the country’s economic output has been greatly affected.
While the economy is forecast to bounce back this year, some economists said the rebound may disappoint, with a slow vaccine rollout adding to growth concerns.


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