BSP easing cycle to continue

Private-sector economists doubt that the widely expected 25-basis-point (bp) cut in key interest rates on Thursday, Aug. 28, will mark the end of the Bangko Sentral ng Pilipinas' (BSP) easing cycle, pointing to the economy's continued slowdown and the rapid decline in inflation.

- By DERCO ROSAL

"We doubt a cut on Thursday would mark the end of the BSP's easing cycle. We expect the policy rate to end the year at 4.75 percent," Capital Economics senior Asia economist Gareth Leather said in a commentary published last week.

Besides the think tank Capital Economics, Singapore-based DBS Bank Ltd. and Japanese financial giant MUFG Bank Ltd. have also forecast a further quarter-point reduction in key borrowing costs, citing contained inflation.