6-10-2023 (MANILA) The Philippines’ Minister of Economics expressed concerns on Friday regarding the potential negative impact of further interest rate hikes by the central bank, citing the potential harm it could cause to consumers already grappling with high inflation. In a press briefing, Minister Balisacan stated his opposition to rate hikes, highlighting that the Philippines has been the most aggressive in the region in terms of raising interest rates.
The country experienced a second consecutive month of accelerated inflation in September, primarily driven by the rapid increase in food and transportation costs. This development has raised the likelihood of the central bank resuming its rate-hiking strategy during its upcoming meeting in November.
September witnessed a notable inflation rate of 6.1%, the highest in four months and surpassing the 5.3% rate recorded in August. As a result, the average year-to-date inflation stands at 6.6%, significantly exceeding the central bank’s target range of 2% to 4% for the year.
However, Minister Balisacan, who is not a member of the central bank’s monetary board responsible for policy-making, expressed reservations about the potential consequences of interest rate hikes on the economy and consumers. He cautioned that such actions could inflict harm rather than provide benefits.
