BSP Holds Rate Steady Amid Higher 2024 Inflation Forecast

In a move aimed at balancing growth with inflation control, the Bangko Sentral ng Pilipinas' policy making Monetary Board decided to maintain the central bank's key interest rate — which is used as the basis of pricing private and public loans in the country — unchanged at 6.50 percent during Monday's meeting.

Following a minor uptick in the inflation forecast for 2024 to 4.0 percent from a previous estimate of 3.9 percent, the BSP opted to keep its monetary policy settings unchanged, saying the current measures are effective in keeping inflation expectations stable.

The decision comes amid concerns over potential price hikes in transport, food, and energy sectors, which pose significant upside risks to inflation. 

The central bank said that the Monetary Board's commitment to price stability underscores its readiness to adjust policy settings if necessary, ensuring the continued alignment of inflation with target levels while supporting domestic growth prospects.