MANILA — Bangko Sentral ng Pilipinas (BSP) Governor Eli Remolona on Thursday said he did not believe the recent uptick in inflation would warrant an interest rate hike.

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

Inflation in the Philippines accelerated to 5.3 percent in August following increases in food and fuel prices.

But on the sidelines of the Alliance for Financial Inclusion Global Policy Forum, Remolona noted that price increases due to supply shocks "usually dissipate fairly quickly."

“So if that’s all there is, if there are no further supply shocks beyond that uptick in August, then it won’t be necessary to hike the policy rate,” he said.

“It won’t justify an easing but it won’t be necessary to raise the policy rate,” he added.

The BSP has kept its benchmark interest rate unchanged at 6.25 percent for the past three meetings.

It is expected to stay that course when the Monetary Board reconvenes on September 21.

• BSP keeps interest rates steady at 6.25 percent

BSP Deputy Governor Francisco Dakila Jr. earlier said that Remolona wanted inflation to be within the government’s target range of 2 to 4 percent before changing the central bank’s policy rate.

• BSP likely to keep benchmark rate unchanged in near-term: official

Remolona said the target could be reached as early as October.

“But hitting the target range is not enough. We want to be comfortably within the target range for the year or so to follow,” he said.

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