PH investors brace for last Fed meet of ’23

Philippine stocks will trade sideways this week as investors position ahead of the final US Federal Reserve policy meeting for the year on Dec. 13.

The benchmark Philippine Stock Exchange index closed the holiday-shortened week last week relatively flat at 6,234.77 as investors digested new data showing domestic inflation cooling further in November to 4.1 percent. The Fed meet could set the tone amid few news drivers.

Michael Ricafort, chief economist at the Rizal Commercial Banking Corp., said it was possible the US central bank would further hike the key rate by another 25 basis points.

“The [Bangko Sentral ng Pilipinas] might need to keep interest rates elevated for most of next year, especially given the possibility of an inflation rebound in the second quarter of 2024,” Bank of the Philippine Islands said, adding: “It might be difficult to cut interest rates without any rate cuts from the Fed given the substantial current account deficit of the country, which could lead to volatility in the exchange rate.” INQ