BSP's Diokno: Banks' reserve requirement may be cut in September

Cathy Yang, ABS-CBN News

Posted at Aug 09 2019 03:41 PM

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MANILA -- Bangko Sentral ng Pilipinas Governor Benjamin Diokno said Friday he could cut the reserve requirement ratio for banks "as early as next month," following another reduction in the benchmark lending rate.

A cut in the RRR, which would increase liquidity in the financial system, "is always on the table," Diokno said, adding his goal was to reduce it to "single digit" by the end of his term.

"We are really convinced that it needs to be cut, the sooner the better," he said, adding the cut could come "within the next few weeks."

The timing of the cut would depend on August inflation data as well as external risks, he said in an exclusive interview with ANC's Market Edge.

The Monetary Board slashed 25 basis points off the overnight borrowing rate last Thursday, after the government reported that gross domestic product growth in the April to June period was at it lowest in 4 years.