BSP Still on Easing Cycle - Remolona

The Bangko Sentral ng Pilipinas remains on an easing trajectory but opted to pause rate cuts for now as it grapples with heightened global uncertainty, BSP Governor Eli Remolona Jr. said.

- By KEISHA TA-ASAN

Speaking to CNBC, Remolona said the Monetary Board would have cut rates on Thursday, but global uncertainties and risks are not yet fully captured by the central bank's economic models.

"We thought we needed more time to deepen our analysis of what's going on," he said.

"We're still on an easing cycle. We want to do 25 basis points at a time and we want to do it in the same direction for a while," the BSP chief said.

According to Remolona, the Monetary Board preferred to pause now and cut rates later rather than continue easing only to reverse course and raise borrowing costs again if risks materialize.

"We're hedging so that we don't find ourselves in a situation where we have to reverse ourselves. We want to stay on an easing trajectory," he said.

"Uncertainty itself is a factor. Investments may be postponed, and there could be hoarding of specific commodities," he added.