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Current monetary policy in the Philippines is adequate to address the economic fallout of the pandemic, while there’s still scope for additional aid on the part of fiscal authorities, the central bank’s governor said.

“We feel that our current monetary policy stance is still appropriate for the economy. So I don’t think there would be any drastic moves on our part to inject any more liquidity into the system,” Benjamin Governor Benjamin Diokno said Thursday in an interview with Bloomberg Television’s Kathleen Hays. “I think there’s still need for some fiscal stimulus.”

Photographer: Geric Cruz/Bloomberg

After cutting its key interest rate by 200 basis points last year, Bangko Sentral ng Pilipinas has held steady at recent policy meetings to support an economy in recession and as inflation run above the bank’s 2%-4% goal. While the BSP last month estimated prices in 2021 to average slightly above that target, Diokno said he’s confident inflation will be within its range longer term. Policy makers have pegged the pressure on transitory supply issues that don’t require a monetary response.

Philippine inflation remains elevated

“We need to take care of the poor and the vulnerable who are affected by the lockdowns,” Diokno said. “We are looking at fiscal and health authorities to do their job.”

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Bernila Andal

By Bernila Andal

Atenio de Manila University – Quezon City A Filipino, Catholic university that has a grade school, high school, undergraduate and graduate programs in the arts, law, management, sciences, education, medicine, and government fields.