Philippines: BSP likely to remain on hold in 2021 – UOB

UOB Group’s Senior Economist Julia Goh and Economist Loke Siew Ting assess the stance of the BSP for the current year.

Key Quotes

“An expected uptrend in inflation and a positive growth outlook painted by the central bank in the Dec 2020 monetary policy statement have raised the odds of an extended rate pause this year. The persistence of negative real interest rates and narrowing interest rate differentials with other central banks may also be on the radar of BSP before making any policy rate decision in the near term. Hence, we expect BSP to keep the overnight reverse repurchase rate unchanged at 2.00% until end-2021. The next Monetary Board meeting is scheduled on 11 Feb.”