BSP delivers another 25-bp rate cut

As inflation pressures recede

-  LOUISE MAUREEN SIMEON

In a briefing following the Monetary Board's policy review, the BSP brought down its target reverse repurchase rate to six percent from 6.25 percent, in its second straight easing after four years.

Interest rates on the overnight deposit and lending facilities were likewise adjusted downward to 5.50 percent and 6.50 percent, respectively.

BSP Governor Eli Remolona Jr. said price pressures remain manageable especially after inflation significantly eased to a four-year low of 1.9 percent in September.

This prompted the BSP to lower its risk-adjusted inflation forecast for this year to 3.1 percent from 3.3 percent previously.

Given the better-than-expected inflation forecast for the year, Remolona said another 25-basis-point reduction during its last meeting in December is possible.

"For now, at least, the easing that we have been doing and we might do, that will keep the inflation rate within the target range," Remolona said.