Bangko Sentral ng Pilipinas Governor Benjamin Diokno said a further slowdown in inflation rate will provide the Monetary Board greater room for policy easing in the months ahead.
Diokno said in a message Monday since monetary policy works with a lag, it will be prudent to see how the past aggressive policy measures it has adopted have been absorbed by the financial system.
“Clearly, the more benign inflation provides the board greater room for easing… Notwithstanding, the BSP will continue to monitor market conditions to any emerging risks to the outlook for both inflation and economic growth, thus, ensure its resolve to deploy necessary policy responses and measures, if warranted,” Diokno said.
In response to the coronavirus pandemic, the BSP cut policy rates by 125 basis points and reserve requirement by 200 bps.
