Metropolitan Bank & Trust Co. (Metrobank) reaffirms expectations that the Bangko Sentral ng Pilipinas (BSP) will begin its rate-cutting cycle in the fourth quarter of this year, aligning with the recent projections from the US Federal Reserve.
The US Fed’s dot plot, which illustrates its interest rate forecasts, suggests a 25 basis point (bp) cut in 2024, with an additional 25-bp cut projected for 2025, reassuring markets of a total 125-bp cut over two years, Metrobank Research said in a note to clients on Friday.
Given the revised US policy rate projections, Metrobank Research now forecasts a total of 50 bps in rate cuts for the BSP this year, adjusting down from an earlier projection of 75 bps, bringing the policy rate to 6 percent.
This move is seen as necessary to support the peso and align with the broader global trend of monetary easing.
