MANILA – Credit ratings firm S&P Global on Thursday said it was keeping its 6.4 percent growth forecast for the Philippines despite lower inflation, as the Bangko Sentral’s hike in borrowing rates last year could have a “lagged” effect on the economy.
The Bangko Sentral raised the overnight borrowing rate by 175 basis points last year as inflation soared to near 10-year highs, bringing the benchmark to 4.75 percent.
“That would have a lagged effect in terms of weighing down consumption investment in the Philippine economy this year…we see no strong reasons to revise up our growth forecast for 2019,” Conti said.
However, analysts said easing inflation could give the BSP room for rate hike pause. (ABS-CBN News)