The Bangko Sentral ng Pilipinas (BSP) expressed the need to further review its monetary policy after inflation in January slowed further and fell below market expectations.
BSP deputy governor Diwa Guinigundo on Tuesday said that policy tightening would “eventually” bring inflation back to the 2 to 4 percent target as consumer prices rose 4.5 percent in January compared to the 4.4-percent consensus of economists.
“This latest positive outcome in inflation management gives the BSP more space to review its current monetary policy. With modest demand pressures, monetary policy could be slight on the brake,” Guinigundo said in a statement. “But the BSP needs the benefit of time and more observations.”
The BSP’s Monetary Board will meet for the first time this year on Thursday and all economists polled by Bloomberg and Reuters expect the central bank to keep the benchmark rate unchanged.