Hawkish BSP kept inflation low – think tank

The hawkishness of the Bangko Sentral ng Pilipinas (BSP) early in the year helped in undershooting inflation targets and is now giving extra room to cut interest rates.

- LOUISE MAUREEN SIMEON

In its latest research brief, think tank Oxford Economics said many emerging markets, such as the Philippines, are being surprised with lower-than-expected inflation.

Lead emerging market economist Tatiana Orlova said Oxford's monetary hawkishness index in September showed that the Philippines and Mexico were the two major emerging markets with the most hawkish monetary policies.

"Some of the hawkish central banks six months ago—the Philippines, Peru, Indonesia, Hungary and Chile—experienced inflation significantly below consensus during the subsequent six months," Orlova said.