Bangko Sentral ng Pilipinas (BSP) Governor Eli Remolona Jr. said Monday another interest rate cut is “quite likely” to happen this August, despite a reported increase in core inflation for July.
Remolona previously told reporters that another key interest rate cut was “on the table” as early as Aug. 28. The governor maintained that two more rate cuts are still possible in the remaining months of the year, depending on economic data.
“I think two is more likely than one,” Remolona said, adding that “three is unlikely.”
The Philippines’ core inflation rate edged up to 2.3 percent in July 2025, from 2.2 percent in June, according to data from the Philippine Statistics Authority. Remolona said this part of inflation, which is affected by monetary policy, tends to be driven by demand factors.
“The core inflation still looks good,” said Remolona on the sidelines of the Economic Journalists Association of the Philippines’ 2025 Economic Forum.
“It’s still on an upward trend, but it’s not going to hit 3 percent until around 2027. Three is the midpoint of our target,” he said.
Headline inflation, however, eased to 0.9 percent in July 2025, the lowest in nearly six years.
The BSP said the headline inflation and core inflation targets remain within reach.
“Both are within our target,” Remolona said in his keynote speech. “We’re hoping we can achieve that because I think that would help stabilize the economy, that would help support investment, support lending by our banks. But as I said, we have work to do.”
The BSP’s Monetary Board is set to hold its policy meeting on Aug. 28 and is expected to have two more meetings before the end of 2025.
