THE BANGKO SENTRAL NG Pilipinas may keep its policy rates at current record-low levels, citing the need for a low interest rate environment to stimulate the economy.

Although the global economy has been showing signs of improvement, a monetary policy supportive of growth is still needed to avoid choking the recovery of the domestic economy, BSP Governor Amando Tetangco Jr. said.

?We have already seen the worst, but the future is not going to be a walk in the park,? Tetangco said in an interview.

The overnight borrowing and lending rates of the central bank currently stand at 4 and 6 percent, respectively, the lowest in history of the BSP. The rates were brought down through a series of cuts from December 2008 to July this year.

The rate reductions were meant to influence banks to cut their lending rates as well and encourage borrowings.

Monetary officials said borrowings should help boost consumption and investment activities while the Philippines was feeling the ill-effects of recession in industrialized nations.

Aided by a low interest rate environment and higher spending by the government, officials said the Philippine economy, measured in terms of gross domestic product, avoided recession and grew by 0.6 percent in the first quarter and 1.5 percent in the second.