By Katherine K. Chan, Reporter
THE Bangko Sentral ng Pilipinas (BSP) may continue raising interest rates to curb inflation despite the risk of slowing economic growth in the near term, as economists said restoring price stability would support a more sustainable recovery.
Alain Jomarie G. Santos, chairman of the University of Santo Tomas Department of Economics, noted that higher interest rates could dampen economic activity, but heated inflation also weakens consumers’ purchasing power.
“To make it simple: higher interest rates are like taking bitter medicine now, so we don’t end up in the ICU (intensive care unit) later,” Mr. Santos told BusinessWorld via Facebook Messenger.
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