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NEWS UPDATES Asean Affairs   October 8, 2018  

BSP hints ‘strong tightening bias’ despite below-forecast inflation

The possibility of another interest rate hike this year is still on the table despite the slower-than-expected September inflation, the Bangko Sentral ng Pilipinas (BSP) said Friday.

Inflation clocked in at 6.7 percent last month, the fastest since February 2009 when it came in at 7.2 percent.

This figure, however, is below the 6.8-percent forecast of the BSP and market's consensus within 6.8 to 7.2 percent.

It is also within the forecast range of  6.3-7.1 percent of the central bank.

"The BSP will remain vigilant with strong tightening bias until such time that we are certain inflation can be sustained within the target range of 2-4 percent for 2019 and 2020," BSP Deputy Governor Diwa Guinigundo said in a text message.

The central bank has raised policy rates four times so far this year - 25 basis points each in May and June and 50 basis points each in August and September - for a total of 150 basis points. This brought the overnight borrowing rate at 4.50 percent.

Guinigundo, however, said it is still too early for the BSP to comment on its next move and September inflation's impact on monetary policy.

"We shall await data on domestic demand, supply conditions, liquidity and credit and of course the actual inflation for October to process them into an integrated view on inflation outlook and appropriate policy stance," the central bank official said.

The Monetary Board's next meeting is scheduled on November 15.

"Despite the impact of Typhoon Ompong, escalating global oil and food commodity prices, we are beginning to feel the positive impact of various non-monetary measures including accelerated release of NFA rice, higher importation of rice and other food commodities as well as close monitoring and surveillance of market prices against possible profiteering and hoarding," Guinigundo said.

"We are also seeing initial signs of moderating growth of both liquidity and credit resulting from the appropriate open market operation through the TDF (term deposit facility), RRP (overnight reverse repurchase) and ODF (overnight deposit facility) facilities of the BSP," he added.

The central bank official also reiterated that September's inflation could have already peaked this year.

"Barring unforeseen events in the last quarter of the year, we could have seen the peak of inflation in recent period and initial signs of disinflationary trend through 2020," Guinigundo said.

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This year in Thailand-what next?

AseanAffairs   04 January 2011
By David Swartzentruber      

It is commonplace in journalism to write two types of articles at the transition point between the year that has passed and the New Year. As this writer qualifies as an “old hand” in observing Thailand with a track record dating back 14 years, it is time take a shot at what may unfold in Thailand in 2011.

The first issue that can’t be answered is the health of Thailand’s beloved King Bhumibol, who is now 83 years old. He is the world's longest reigning monarch, but elaborate birthday celebrations in December failed to mask concern over his health. More






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