The Bangko Sentral ng Pilipinas on Friday said it would not hesitate to cut interest rates further – even if the policy rates now in place are at record lows – if the global economic situation plaguing the US and Europe takes a turn for the worse.
 
This will happen once indicators reveal that a weak global economy is putting a drag on the Philippines, said Bangko Sentral ng Pilipinas Governor Amando Tetangco Jr.
 
“Our latest assessment is that the global economy remains weak,” Tetangco said.
 
This year, the Bangko Sentral has so far cut its key rate three times for a cumulative cut of 75 basis points, the last one by 25 basis points last month.
 
Central bank’s key rates are at historic lows of 3.75 percent for overnight borrowing and 5.75 percent for overnight lending.
 
“The latest action by the Monetary Board is consistent with the latest assessment of the inflationary environment. But things do change, and we should be alert to these changes. We should see whether there is an indication of a need for another policy change,” Tetangco said. — VS, GMA News