FINANCE Secretary Ralph Recto said he doesn’t expect the country’s key interest rate to go higher than the current 6.5 percent.
During the Philippine Economic Briefing in Manila on Monday, May 27, Recto said he agreed with the Bangko Sentral ng Pilipinas that an interest rate cut is possible this year.
He said this is because inflation seems to be going down.
“It seems like inflation is going down, it used to be 8.2 percent, it’s down to 3.8 percent, well within the 2 to 4 percent band,” Recto said.
He added: “So it’s possible that we may have rate cut this year, and possibly more rate cuts next year. I don’t expect interest rates to go any higher.”
The BSP Monetary Board in its last meeting kept the benchmark target reverse repurchase rate at 6.5 percent.
Inflation, meanwhile, quickened to 3.8 percent in April while still remaining within the government target of 2 to 4 percent.
BSP Governor Eli Romolona earlier hinted at a possible rate cut this August.
Recto, meanwhile said he sees a 150-basis points rate cut “in the next few years.” (ABS-CBN News)
