BSP seen to hike rate 'one more time' as inflation remains elevated: economist


Posted at Mar 28 2023 12:06 PM

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The Bangko Sentral ng Pilipinas is seen to raise the country's benchmark interest rate by at least one more time as inflation remains elevated, Moody’s Analytics Chief Economist Steven Cochrane said on Tuesday.

Inflation slightly eased to 8.6 percent in February from 8.7 percent the previous month. However, core inflation rose to 7.8 percent from 7.4 percent, according to government data.

"I think it’s clear that inflation hasn’t been whipped, so that’s why I do think there might be one more rate hike coming. It depends on the data coming before the next BSP meeting," Cochrane said. 

In its recent meeting, the BSP hiked the overnight borrowing rate by 25 basis points to 6.25 percent. 

Inflation is expected to ease back below 4 percent later this year on a month-on-month basis, according to government estimates. The average, however, is seen to revert to within the 2 to 4 percent target by 2024.