MANILA, Aug. 28 (Xinhua) -- The Philippine central bank said on Thursday that it decided to reduce its target reverse repurchase rate by 25 basis points to 5 percent, and interest rates on the overnight deposit and lending facilities were adjusted to 4.5 percent and 5.5 percent, respectively.
In a statement, the Bangko Sentral ng Pilipinas (BSP) said that the inflation outlook "is broadly unchanged." The inflation forecast for 2025 settled at 1.7 percent. Forecasts stand at 3.3 percent for 2026 and at 3.4 percent for 2027.
"Inflation expectations also remain well-anchored. Meanwhile, possible electricity rate adjustments and higher rice tariffs could raise inflationary pressures over the policy horizon," the statement said.
The central bank said its monetary board observed that domestic demand has remained firm. "However, the impact of U.S. policies on global trade and investment continues to weigh on global economic activity. This could temper the outlook for the Philippine economy," said the BSP.
Emerging risks will continue to require close monitoring. The monetary board will determine a monetary policy response based on an evolving outlook for inflation and growth, the central bank said. ■
