Below-target inflation supports case for another rate cut, analysts say

THE BANGKO SENTRAL ng Pilipinas (BSP) will be able to further reduce interest rates amid below-target inflation and weak economic growth, analysts said.

“With inflation holding near multi-year lows and the peso showing relative strength, a rate cut from the BSP in June has become more certain,” Bank of the Philippine Islands Lead Economist Emilio S. Neri, Jr. said.

This after inflation cooled to an over five-year low of 1.3% in May, bringing the five-month average to 1.9%. This is below the BSP’s 2-4% target band.