MANILA - The Bangko Sentral ng Pilipinas said Friday the slower inflation in January provides enough room to remain patient in terms of monetary policies.
Inflation settled at 3 percent in January, using 2018 as the new base year, government data released on Friday showed.
The BSP has kept interest rate at its record low of 2 percent in 2021 to support economic recovery.
“Given a manageable inflation outlook, the BSP sees ample scope to keep a patient hand on its various policy levers, while keeping an eye on potential risks to inflation and the financial system,” the BSP said.
Several central banks in the world have started raising interest rates to address inflation.
The 3 percent total is likely to decelerate further in the coming months pushing the annual total back within the target range, the central bank said.
In 2021, inflation settled at 4.5 percent, above the government target of 2 to 4 percent.
The BSP earlier said it was waiting for the right conditions to unwind stimulus placed during the COVID-19 pandemic.
Several analysts have predicted that the Monetary Board would start tightening the benchmark policy rate this year.
Despite the faster-than-anticipated growth in the fourth quarter of 2021, which brought the entire year economic growth to 5.6 percent, the BSP said COVID-19 continues to be a “lingering threat” to the near-term outlook for growth.