The central bank will assess whether another rate hike is needed this month to cap rising consumer prices after government data showed the inflation rate plateauing, but still at a high level.
In a statement, Bangko Sentral ng Pilipinas (BSP) Governor Nestor Espenilla Jr. said the average increase of prices of goods and services for October of 6.7 percent – unchanged from September’s level – “supports the view that inflation pressures are finally moderating.”
“The Monetary Board will take into account these and other incoming data including gross domestic product [growth] at its next policy meeting when it determines if there’s still need for further policy rate adjustments,” he said, striking a more dovish note than in previous statements.
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The market, however, viewed the flat month-on-month inflation rate as an indication that another modest rate hike may come when the BSP’s policy making body convenes next week to decide on the direction of interest rates.
“Given that inflation has not been able to show a substantial deceleration trend, the likelihood of that “moderate” rate hike at the Nov. 15 meeting has increased,” ING Bank senior economist Nicholas Mapa said.
