BSP says its policy decisions not dependent on Fed’s

March 20, 2024 - 6:33 PM
(Photo from BusinessWorld)

 ⁠The Philippine central bank said on Wednesday it is “closely” watching the U.S. Federal Reserve’s actions, but its own monetary policy decisions are not dependent on what the Fed does.

Bangko Sentral ng Pilipinas Governor Eli Remolona said the central bank was still “hawkish”, with inflation still hovering close to the upper end of the government’s 2% to 4% target range.

Annual inflation could accelerate further to 3.9% in March from the previous month’s 3.4% due to base effects, Remolona told reporters.

The central bank, which kept its benchmark rate steady at 6.50% for a third straight meeting in February, next meets on April 4 to review policy.

“We don’t have to put a lot of weight to what they (Fed) do, unless the markets go crazy, unless they overreact, the peso somehow weakens sharply then we have to react more decisively. But we don’t expect that,” Remolona said.

Central banks and investors around the world have their eyes on the Fed, which is expected to announce its rates decision at 1800 GMT on Wednesday. It is not expected to make changes to the policy rate but could offer insights into its outlook on rate cuts.

— Reporting by Mikhail Flores; Editing by Kanupriya Kapoor