BSP maintains rates – poll

The Bangko Sentral ng Pilipinas (BSP) has decided to maintain its key interest rates, according to a recent poll conducted by Reuters. The poll showed that all 15 economists surveyed predicted that the BSP would keep its overnight borrowing rate at 2.0%, while 14 of them expected the overnight lending rate to remain at 2.5%.

The decision to maintain rates comes as the Philippine economy continues to struggle amid the ongoing COVID-19 pandemic. The country’s gross domestic product (GDP) contracted by 9.5% in 2020, the worst performance in more than three decades. The BSP has been implementing various measures to support the economy, including cutting interest rates by a total of 200 basis points last year.

Despite the challenges, the BSP remains optimistic about the country’s economic prospects. In a recent statement, BSP Governor Benjamin Diokno said that the economy is expected to recover this year, with GDP growth projected to be between 6.5% and 7.5%. He also noted that inflation is expected to remain within the BSP’s target range of 2% to 4%.

The decision to maintain rates is in line with the BSP’s commitment to support the economy while keeping inflation under control. The central bank has emphasized that it will continue to monitor economic developments and adjust its policies as needed.

Overall, the BSP’s decision to maintain rates is a positive development for the Philippine economy. While there are still challenges ahead, the central bank’s commitment to supporting growth and stability is a reassuring sign for investors and businesses alike. As the country continues to navigate the pandemic, the BSP’s policies will play a crucial role in shaping the economic recovery.