MANILA -- The Asian Development Bank (ADB) on Monday urged governments and central banks in emerging East Asia to stay vigilant against potential financial risks from higher interest rates.

A new ADB report said with interest rates in the region remaining elevated, higher borrowing costs have contributed to debt stress and bond defaults in some Asian markets over the past few months.

Higher borrowing costs pose a challenge, especially for borrowers with weak governance and balance sheets.

The report added that a faster than expected decline in inflation in advanced economies, combined with a cooling in the job market might lead to less hawkish monetary stances.

The Bangko Sentral ng Pilipinas (BSP) kept its policy rate at 6.25 percent after inflation slowed down for a sixth straight month in July.

• BSP keeps interest rates steady at 6.25 percent

Inflation, however, quickened to 5.3 percent in August.

• Inflation quickens to 5.3 pct in August as rice, fuel costs rise

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