Julia Goh, Senior Economist at UOB Group and Economist Loke Siew Ting comment on the June BSP event.
“Bangko Sentral ng Pilipinas (BSP), as expected, raised its overnight reverse repurchase (RRP) rate for the second straight meeting by 25bps to 2.50% today (23 Jun). Accordingly, both the overnight deposit and lending rates were also hiked to 2.00% and 3.00% respectively.”
“The latest move came after the national inflation hit above BSP’s 2.0%-4.0% medium-term target range in May (at 5.4%) and the government approved PHP1 provisional fare hike for jeepneys in mid-Jun that will likely intensify second-round effects on headline inflation. In view of inflation risks still tilting to the upside, BSP revised its inflation forecasts higher to 5.0% for 2022 (from 4.6% previously, UOB est: 5.0%) and 4.2% for 2023 (from 3.9% previously, UOB est: 4.0%), and introduced a 3.3% inflation outlook for 2024.”
“The accompanying statement revealed BSP’s top priority now is to bring inflation back to its 2.0%4.0% target range over the medium term, which is in line with our expectations. Hence, we continue to expect BSP to raise rates by a measured 25bps at every remaining meeting of this year in Aug, Sep, Nov, and Dec. This will bring the RRP rate to 3.50% by the end of 2022.”
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.
If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.
FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.
The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.