Analysts say that the durable rate reduction is not possible

The Bango Central NG Pilipinas (BSP) will soon resume reduction rates, and researchers have argued that even more tight financial conditions may weigh the economy at the time of global uncertainty.

Although August 2024 has been cut down from August 2024, the real interest rates-or the real cost of borrowing after the fact that the inflation is caused by inflation-said Pandiyon Macro Economist Mikwal Sango said.

This means that last week’s surprise free of charge does not last long, Chango said, while sticking to his prediction on a total rate of 100-PP this year. This is much worse than the overall cut of the half -point telegraph to the BSP Governor Eli Remolona Jr.

“We are very suspicious that this will indicate the beginning of the long -term suspension; in fact, we are more than the content of our basic case,” Zhango said in a commentary.

Economic redemption

“The reason we stick with our guns is that the real policy rate is historically tight and only moderate cuts can be a risk of delaying the restoration of the economy,” he said.

At its first policy meeting this year, the Central Bank decided to keep the criteria of the banks generally used as a guide when it was withdrawn from 5.75 per cent. The move acknowledged that Remolona was not an easy decision for the monetary authorities.

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For the market audience, which predicted another moderate rate reduction, the BSP to focus on supporting the economic growth of a restrooming inflation, which was 2.9 percent in January.

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But the Bahujan Samaj Party boss explained that the inflation and the impact of the back-bin payment operations in the US on the inflation and the domestic economy will help the central bank to better assess. Remolona said the Bahujan Samaj Party would make it easier for uncertainty clouds.

Pay attention to the risks

In a separate commentary, Nomura’s economists, Euphon Paraguvelus and Nabila Amani, described the decision of the Bahujan Samaj Party as a “chaotic pause”.

“The universal policy is negative to the outlook of a few channels through a few channels,” they said. “So, we consider it extra fair to reduce the policy rate again. Don’t stop.”

But Romeo and Bernardo, a member of the Monetary Board, the BSP’s policy organization, said the Central Bank said it was “taking care of the risks to our inflation perspective.”

“Even if our primary attention is inflation, we take into account the impact of the real and financial sectors in measurement of the money position, which ensures that the country is flexible in a wide front,” Bernardo said in a speech in front of corporate directors last week.

“Let it be clear that the BSP seems to be continuing its measured change towards the low -controlled currency policy systems, but it will be based on data on the speed and time to decrease in the policy rate,” he said. Inq