{"id":19464,"date":"2024-06-26T03:01:18","date_gmt":"2024-06-26T03:01:18","guid":{"rendered":"https:\/\/energybuzz.ph\/staging\/6915\/bsp-rate-cuts-unlikely-this-year-anz\/"},"modified":"2024-06-26T03:01:18","modified_gmt":"2024-06-26T03:01:18","slug":"bsp-rate-cuts-unlikely-this-year-anz","status":"publish","type":"post","link":"https:\/\/energybuzz.ph\/staging\/6915\/bsp-rate-cuts-unlikely-this-year-anz\/","title":{"rendered":"BSP rate cuts unlikely this year \u2014 ANZ"},"content":{"rendered":"
\n

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THERE IS NO ROOM for the <\/span>Bangko Sentral ng Pilipinas (BSP) to cut rates this year as in<\/span>f<\/span>lation may still potentially breach the target, ANZ Research said. <\/span><\/p>\n

\u201cRate cuts in Indonesia and the Philippines are also not on the table this year\u2026 In the Philippines, in<\/span>f<\/span>lation though receding, is still running close to the upper bound of the o<\/span>ff<\/span>icial target range of 2-4%,\u201d it said in its quarterly report. <\/span><\/p>\n

ANZ Research said inflation in developing Asia has \u201ceased considerably\u201d especially in the Philippines, where inflation \u201chas remained in the o<\/span>ff<\/span>icial target range despite elevated food prices.\u201d <\/span><\/p>\n

\u201cThe outturns are still not low enough to permit rate cuts, but even so they have allowed the BSP to dial down its hawkishness,\u201d it added. <\/span><\/p>\n

In<\/span>f<\/span>lation quickened for the fourth straight month to 3.9% in May from 3.8% in April. It may potentially breach the 2-4% goal until July, the BSP earlier said. <\/span><\/p>\n

The Monetary Board is set to meet on Thursday for its policy review. All 15 analysts surveyed in a BusinessWorld<\/i> poll last week expect the central bank to keep rates unchanged at a 17-year high of 6.5% for a sixth straight meeting. <\/span><\/p>\n

BSP Governor Eli M. Remolona, <\/span>Jr. has signaled that policy easing could begin as early as August. <\/span><\/p>\n

However, ANZ said it expects the BSP to begin easing with a 50-basis-point (bp) rate cut in March next year. <\/span><\/p>\n

For the rest of 2025, it sees rate cuts worth 50 bps in June, 25 bps in September and another 25 bps in December to end the year with the benchmark rate at 5%.<\/span><\/p>\n

ANZ also expects the policy rate to stay at 5% through June 2026. <\/span><\/p>\n

Meanwhile, DBS Bank Ltd. said in a separate report that it expects the BSP to \u201ckeep the rate on an extended pause\u201d this year. <\/span><\/p>\n

\u201cWe expect the Philippine central bank to keep the benchmark rate at a 17-year high of 6.5% this week, with restrictive plans to keep in<\/span>f<\/span>lation in check as well as support the currency,\u201d it said. <\/span><\/p>\n

DBS said it expects the first rate cut of 25 bps to be delivered in the first quarter of 2025, followed by a 25-bp cut in the second quarter and another 25-bp cut in the third quarter. This would bring the key rate to 5.75% by end-2025.<\/span><\/p>\n

It noted recent comments from Finance Secretary Ralph G. Recto, who said the BSP could only reduce inter<\/span>est rates after the Federal Reserve. <\/span><\/p>\n

On the other hand, Mr. Remolona has said they do not need to mirror the Fed and could cut ahead of the US central bank. <\/span><\/p>\n

Meanwhile, ANZ <\/span>raised its Philippine GDP growth forecast to 5.9% this year from 5.7% in its report in March. This would be a tad lower than the 6-7% government target. <\/span><\/p>\n

The research firm noted that household consumption is moderating in the region. <\/span><\/p>\n

\u201cIn the Philippines, the slowdown in private consumption is more genuine, driven by weaker purchasing power. We view this slowdown positively as it should alleviate in<\/span>f<\/span>lation and current account pressures,\u201d it said. <\/span><\/p>\n

Household consumption typically accounts for three-fourths of Philippine GDP. It rose by 4.6% in the fourth quarter, the slowest since the 4.8% <\/span>decline in the first quarter of 2021. <\/span><\/p>\n

For 2025, ANZ also hiked its Philippine growth forecast to 6.1% from 5.9%. This is also below the government\u2019s 6.5-7.5% goal. <\/span><\/p>\n

The economy grew by 5.7% in the <\/span>f<\/span>irst quarter. To meet the lower end of the 6-7% target, GDP would need to average 6.1% in the next quarters, according to the National Economic and Development Authority. \u2014 Luisa Maria Jacinta C. Jocson<\/b><\/span><\/p>\n<\/div>\n","protected":false},"excerpt":{"rendered":"

THERE IS NO ROOM for the Bangko Sentral ng Pilipinas (BSP) to cut rates this year as inflation may still potentially breach the target, ANZ Research said. \u201cRate cuts in Indonesia and the Philippines are also not on the table this year\u2026 In the Philippines, inflation though receding, is still running close to the upper [\u2026]<\/div>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"nf_dc_page":"","footnotes":""},"categories":[1],"tags":[18525,5796,14644,2527,1744,745,6789,1369,11],"class_list":["post-19464","post","type-post","status-publish","format-standard","hentry","category-uncategorized","tag-anz","tag-bsp","tag-bworldonline","tag-cuts","tag-rate","tag-this","tag-unlikely","tag-year","tag-years"],"yoast_head":"\nBSP rate cuts unlikely this year \u2014 ANZ - Energy Buzz<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/energybuzz.ph\/bsp-rate-cuts-unlikely-this-year-anz\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"BSP rate cuts unlikely this year \u2014 ANZ - 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