Quantcast
Latest Stories

BSP sharpens tools to combat inflation

Dev’ts abroad seen to threaten PH targets

By

BSP Governor Amando M. Tetangco Jr.: Ready to make adjustment. INQUIRER FILE PHOTO

MANILA, Philippines—The Bangko Sentral ng Pilipinas (BSP) may further refine crucial economic measures, apart from its current stance on monetary policy, to combat risks to inflation that have crept up in recent months.

BSP Governor Amando M. Tetangco Jr. said that while the country remains in an economic “sweet spot,” which is characterized by high growth and low inflation, developments abroad may force local policymakers to take decisive action.

“BSP stands ready to make refinements to existing macroprudential measures and deploy new ones, if necessary,” Tetangco on Tuesday said, referring to specific economic tools designed to reduce inflation risks.

During Tuesday’s Philippine Economic Briefing, Tetangco also cited developments overseas that threaten the central bank’s inflation target and the government’s full-year growth goal. Chief of these was the uncertainty over the timing of the US Federal Reserve’s decision to scale down its monthly bond-buying program that was started late 2009.

Speculations over the fate of the US Fed’s asset-purchases—worth $85 billion a month—have prompted foreign investors to flee emerging markets like the Philippines and return to developed nations where investment yields are said to have improved.

The asset purchases started by the Fed in 2009 were meant to prop up the US economy by keeping interest rates low. Most market players expect the US Fed to start reducing its asset purchases this September.

Measures that have so far been implemented by the central bank include refinements to its Special Deposit Account (SDA) facility, which was originally devised as a monetary policy tool, but was used as an investment destination by local banks.

One such change involved the introduction of restrictions on foreign money being placed in SDAs. Another is the ban on individual investments in the facility.

“There are still a number of options that we have. We are still undecided which ones to use,” Tetangco said.

Other risks to price stability and economic growth include weak economic conditions in developed markets, particularly in China, Japan, Europe, and the United States—the Philippines’ major trading partners.

Tetangco likewise said the BSP was monitoring developments in war-torn Syria, which may spill over to neighboring countries in the Middle East and, in turn, restrict the flow of the world’s oil supply. This will mean higher fuel prices for countries like the Philippines, which imports nearly all of its oil requirements.

Tetangco also said that the BSP is ready to make adjustments in its monetary policy stance.


Follow Us


Follow us on Facebook Follow on Twitter Follow on Twitter


Recent Stories:

Complete stories on our Digital Edition newsstand for tablets, netbooks and mobile phones; 14-issue free trial. About to step out? Get breaking alerts on your mobile.phone. Text ON INQ BREAKING to 4467, for Globe, Smart and Sun subscribers in the Philippines.

Tags: Amando M. Tetangco Jr. , Bangko Sentral ng Pilipinas , economy , Inflation , Philippines

  • eight_log

    Sharpens tools???? As if alam ninyo ang ginagawa ninyo …. you must set policies that will stay in the long term … not in a daily or weekly or even monthly basis. Yan ba ang tinatawag ninyong sharpen???? Nakakatawa!!!!!!

  • RealityCheckX

    Finance, CB and NEDA are so fond of blaming externalities for every macroeconomic ill we have. In this, they are no different from lazy journalists. Can we start by redefining the market basket and revealing how badly Pinoys are groaning under the high prices of the sin tax, electricity c/o Tito Danding and Napocor, sugar, rice, noodles, LPG c/o ERC and Tito Danding…



Copyright © 2014, .
To subscribe to the Philippine Daily Inquirer newspaper in the Philippines, call +63 2 896-6000 for Metro Manila and Metro Cebu or email your subscription request here.
Factual errors? Contact the Philippine Daily Inquirer's day desk. Believe this article violates journalistic ethics? Contact the Inquirer's Reader's Advocate. Or write The Readers' Advocate:
c/o Philippine Daily Inquirer Chino Roces Avenue corner Yague and Mascardo Streets, Makati City, Metro Manila, Philippines Or fax nos. +63 2 8974793 to 94
Advertisement
Advertisement

News

  • 16 suffer burns in Batangas sugar factory accident
  • Angat level drops; cloud seeding set
  • Indigenous aspiration in Bangsamoro
  • Banahaw continues to lure pilgrims, trekkers
  • Passion of Christ moves survivors
  • Sports

  • Tottenham beats Fulham 3-1 in Premier League
  • Martino defends Messi, takes blame for Barca fail
  • Vettel hoping for resurgence at Chinese GP
  • MLB pitcher donates $100,000 for Sewol ferry victims
  • Hamilton takes pole at Chinese Grand Prix
  • Lifestyle

  • Levine designs womenswear with help from fiancee
  • Gabriel Garcia Marquez, Nobel laureate, dies at 87
  • Ford Mustang turns 50 atop Empire State Building
  • Pro visual artists, lensmen to judge Pagcor’s photo contest
  • ‘Labahita a la bacalao’
  • Entertainment

  • Why ‘Noah’ can’t dock his ark at Philippine theaters
  • Acclaimed artist goes wild while on holiday
  • Believing in this mermaid
  • Missing Xian
  • Minnie Driver plays devastated mother to a stillborn child
  • Business

  • A workplace of new possibilities
  • Learning by doing: pilgrimage of faith
  • Fiat-Chrysler to produce iconic Jeep in China from 2015
  • US commerce secretary spells out economic facet of ‘pivot to Asia’
  • Italy sells luxury state cars on eBay
  • Technology

  • Nasa’s moon-orbiting robot crashes down
  • Netizens pay respects to Gabriel Garcia Marquez
  • Nokia recalls 30,000 chargers for Lumia 2520 tablet
  • Facebook rolls out ‘nearby friends’ feature
  • Netizens seethe over Aquino’s ‘sacrifice’ message
  • Opinion

  • Editorial cartoon, April 17, 2014
  • A humbler Church
  • Deepest darkness
  • ‘Agnihotra’ for Earth’s health
  • It’s the Holy Week, time to think of others
  • Global Nation

  • Cesar Chavez movie sparks memories of Fil-Am labor leaders
  • Filipinos in US poised for success
  • Visas for priests and other faith leaders
  • DOH to continue tracking co-passengers of OFW infected with MERS virus
  • 5 Filipinos with MERS in UAE reported in stable condition
  • Marketplace