Tightening may start after next week’s policy meeting
By Paolo Montecillo
Philippine Daily Inquirer
12:28 am | Friday, March 21st, 2014
BSP Governor Amando M. Tetangco Jr. INQUIRER FILE PHOTO
The central bank has hinted at a hike in benchmark interest rates following the US Federal Reserve’s decision to further reduce its monetary stimulus for the world’s largest economy.
Bangko Sentral ng Pilipinas (BSP) Governor Amando M. Tetangco Jr. on Thursday left little room for doubt that an adjustment in current policy settings was forthcoming, possibly as early as next week.
“On the part of the BSP, we see early measured adjustments in monetary policy as ideal. Gradual rather than discrete movements would be less disruptive and would help businesses plan better,” Tetangco said in a statement Thursday morning.
“Even as domestic inflation over the policy horizon remains within target, measured adjustments may be warranted given external developments including the heightened geopolitical risks that could result in volatility in international commodity prices,” he said.
The BSP’s Monetary Board meets next Thursday to decide on possible interest rate adjustments.
Key overnight borrowing and lending rates have been at their current record lows of 3.5 and 5.5 percent since late 2012.
Earlier this week, the Federal Open Market Committee (FOMC) decided to cut the US Fed’s monthly bond buying program by another $10 billion for the third consecutive meeting. Starting April, the US Fed will buy US treasuries and mortgage-backed securities at a rate of $55 billion a month, down from an original $85 billion.
The Fed’s bond buying program, also referred to as quantitative easing, was introduced in late 2009 to help the US economy recover from the global financial crisis. The asset purchases drove down interest rates in the US, pushing investors to emerging markets like the Philippines in search of higher yields.
Follow Us
Other Stories:
Recent Stories:
Short URL: http://ift.tt/OB6rYZ
Tags: Bangko sentral , benchmark interest rates , Business
Factual errors? Contact the Philippine Daily Inquirer's day desk. Believe this article violates journalistic ethics? Contact the Inquirer's Reader's Advocate. Or write The Readers' Advocate:
seo tools
No comments:
Post a Comment