© Reuters. FILE PHOTO: Bangko Sentral ng Pilipinas Governor Felipe Medalla poses for {a photograph} in his workplace at Manila, Philippines, November 18, 2022. REUTERS/Eloisa LopezMANILA (Reuters) – Philippine central financial institution governor Felipe Medalla mentioned on Friday that within the “worst-case situation” of inflation rising above 9%, rates of interest is likely to be hiked by 50 foundation factors.
Bangko Sentral ng Pilipinas’ (BSP) subsequent charge hike might be 25 or 50 foundation factors relying on the newest financial information, he mentioned.
“Worst-case situation is (inflation) above 9%. If that is the case, clearly now we have to do one thing,” Medalla advised reporters.
Inflation in January hit a 14-year excessive of 8.7%, prompting BSP to say it was prone to increase its benchmark rate of interest yet another time this 12 months, after having hiked by 50 foundation factors on Feb. 16.
February’s inflation information is due out on March 7, with analysts set to carefully watch the quantity forward of the central financial institution’s subsequent rate-setting assembly on March 23.
“One other month…of upside shock for inflation may prod the BSP to hike extra aggressively,” mentioned Nicholas Mapa, senior economist at ING.
BSP has raised charges eight occasions for a complete of 400 foundation factors since final 12 months,
Medalla mentioned on Friday he nonetheless anticipated inflation to return to inside a goal vary by the fourth quarter of this 12 months.
