MANILA - The Bangko Sentral ng Pilipinas may further cut interest rates before the year ends due to slowing inflation, an analyst said Friday.
The BSP on Thursday cut interest rates for the third time this year, bringing the benchmark to 4 percent from 4.75 percent in 2018.
"Indeed the benign inflation also set a favorable backdrop for monetary easing especially at a time when support for growth is needed so we are also expecting further easing from the BSP," Westpac Banking Corp head of Macro Strategy-Asia Frances Cheung told ANC.
"There could be one or two more interest rate cuts but I think the focus is not with the only interest rate cut but for example the reserve requirement ratio which they didn’t do at the same time with the interest rate cut," she added.
Structurally, there is room for further RRR cuts, Cheung said. The BSP reduced reserve requirement by a cumulative 200 basis points earlier this year.
The peso "has not been affected much" by the monetary policy easing, Cheung said.