Two more rate cuts likely - Recto

The Bangko Sentral ng Pilipinas (BSP) has room to cut interest rates by 50 basis points this year, despite global uncertainties and changing expectations on the policy path of the US Federal Reserve, Finance Secretary Ralph Recto said.

- By MARCO LUIS BEECH

"I think the BSP is clear that we expect a 50-basis-point rate cut all the way till the end of the year," Recto said, referring to two more 25-basis-point reductions in the second half. "We have room to cut."

Pressed if he is personally in favor of a rate cut as early as next month, Recto said, "I'm in favor. Two for the year, 25 basis points and 25 basis points."

BSP Governor Eli Remolona Jr. earlier signaled the possibility of two more interest rate cuts this year, which could bring the benchmark policy rate down to 4.75 percent from the current level of 5.25 percent.