Governor Eli Remolona told Bloomberg TV on Friday ( Apr 11 ) that the Philippine central bank is adopting a cautious approach to policy easing this year to prevent overheating the economy and reigniting inflation, which has been on a downward trend.
The Bangko Sentral ng Pilipinas cut its benchmark interest rate by 25 basis points to 5.50 per share on Thursday, signaling further reductions in “baby ways” as it tries to boost the economy in the face of world uncertainty.
Remolona said,” We don’t want to overdo it.” ” If we overdo it, we start exceeding power, and therefore prices returns.” We therefore aim to achieve the natural level without any issues.
The BSP generally relies on a middle, which Remolona said was at around 2 %, but uses several quotes for the natural rate, which is the philosophical threshold at which monetary policy neither stimulates nor restricts development.  ,
He also ruled out intermeeting rate increases, noting that policy choices are usually made at arranged meetings, which take place every other month. There are still four sessions scheduled for this year, with the next one scheduled for June 19.
Remolona added that this week the Philippines hasn’t been stifling the foreign exchange market as much as it has regular and that it is considering diversifying foreign reserves rather than lowering them.
Remolona stated,” We have the right combination of assets in deposits.”