Philippines keeps policy rate at 4%, extends crisis measure phase-out

By Richard Connell

New York, April 22 - The Monetary Board of the Bangko Sentral ng Pilipinas left its overnight borrowing rate at 4% while announcing continued plans to disengage from its crisis intervention measures at its meeting on Thursday, according to a news release issued by the bank.

The board of the Philippines central bank based its decision on inflation projections which showed that while inflation has risen somewhat, it remains within the target range for both 2010 and 2011.

The board also pointed out that while the global economic recovery is continuing, it remains dependent on stimulus policies, leading to doubts as to its self-sustainability.

Noting current favorable credit and liquidity positions, the board reduced the peso rediscounting budget to the pre-crisis level of PHP 20 billion from PHP 40 billion as another step in exiting the crisis intervention measures.

The board has now kept the policy rate at 4% at six consecutive meetings, dating back to July.

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