Latest Stories

Monetary Board opts to keep key policy rates steady


The Bangko Sentral ng Pilipinas on Thursday kept key interest rates unchanged from their historic low levels, believing no adjustment is needed at the moment given the high economic growth and low inflation that the country now enjoys.

The BSP’s key policy rates, which influence commercial interest rates, still stand at record lows of 3.5 percent and 5.5 percent for overnight borrowing and lending, respectively.

“The Monetary Board is of the view that the manageable inflation outlook and robust domestic growth support keeping policy rates steady,” BSP Governor Amando Tetangco Jr. said in a briefing immediately after the board’s meeting.

A report saying that the economy, measured in terms of gross domestic product, grew by a surprising 7.1 percent in the third quarter from a year ago convinced the Monetary Board to keep the rates steady.

The Philippines’ growth rate during the period was the fastest recorded in Southeast Asia.

This brought average growth for the first three quarters of the year to 6.5 percent, allowing the country a greater chance to exceed the official full-year growth target of 5 to 6 percent.

The government also reported earlier that inflation averaged at only 3.2 percent in the first 11 months of the year, staying well within the full-year target of 3 to 5 percent.

The BSP’s monetary policy had been brought down to record lows this year following a series of rate cuts in January, March, July and October—each by 25 basis points.

The four previous rate cuts were meant to help boost domestic demand and offset the impact of anemic export earnings on the economy’s growth performance.

Export revenues have been volatile this year given the crisis in most export markets, led by the eurozone. The BSP said low interest rates can help boost demand for bank loans, which in turn should fuel more consumption and investments.

BSP Deputy Governor Diwa Guinigundo said the previous rate reductions proved to be effective in helping boost growth of the economy.

Moreover, the outlook that the economy will continue to grow robustly, while inflation will remain benign over the short to medium term, indicated that the current interest-rate environment is appropriate.

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: Bangko Sentral ng Pilipinas , Business , Interest Rates , monetary board , Philippines , policy rates

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


  • Gloomy weather on Black Saturday–Pagasa
  • Mixed feelings for Gabriel Garcia Marquez in hometown
  • Korea ferry captain arrested, divers spot bodies
  • Enrile chief aide back in PH ‘to face charges’–report
  • Pakistan library named ‘bin Laden,’ as memory fades
  • Sports

  • Duke’s Rodney Hood joining Jabari Parker in NBA draft
  • Phelps entered in 3 events at comeback meet
  • Boston prepares for huge wave of marathon visitors
  • Motivated LeBron James preps for postseason
  • Nadal ousted by Ferrer in Monte Carlo quarters
  • 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

  • Myx TV premieres Asian American ‘docu-series’
  • A nutty finale for ‘Scandal,’ TV’s craziest show
  • EXO postpones release of mini album ‘Overdose’
  • ‘X-men’ filmmaker slams ‘fabricated’ sex attack claims
  • Singer Chris Brown’s bodyguard on trial in DC
  • Business

  • US commerce secretary spells out economic facet of ‘pivot to Asia’
  • Italy sells luxury state cars on eBay
  • Asian shares mostly up in quiet trade
  • Dollar up in Asia on US jobs data, Ukraine deal
  • Barbie doll has a problem
  • 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

  • OFW from UAE tests negative for MERS-Cov–health chief
  • Multicultural flock marks Good Friday in San Francisco
  • Las Vegas ‘Pinoy Pride’ fest hails Filipino heritage
  • Marking Jesus’ journey on Good Friday
  • Filipina accomplice arrested for fake bills in Malaysia
  • Marketplace