The Monetary Board, the policy-making body of Bangko Sentral ng Pilipinas, on Thursday kept the policy rates steady as it considered the benign inflation and the sustained economic growth.
Bangko Sentral Governor Nestor Espenilla Jr. said in his first policy meeting as MB chairman that the interest rates were left unchanged at 3.5 percent for overnight lending, 3 percent for overnight borrowing and 2.5 percent for overnight deposit facility. The reserve requirement ratios were also retained.
“While inflation forecasts have risen slightly due to the recent increase in global oil prices, the future inflation path continues to be within the target for 2017-2019,” Espenilla said.
He said while the proposed tax reform program might exert potential transitory pressures on prices, various social safety nets and the resulting improvement in productivity would likely temper the impact on inflation over the medium term.
The board increased the inflation forecast this year to 3.2 percent from 3.1 percent. It also adjusted the forecast for 2018 to 3.2 percent from 3 percent.