BSP keeps key rates steady

The Bangko Sentral ng Pilipinas decided to leave overnight interest rates steady at the weekly meeting of its policy-making Monetary Board yesterday.

The overnight borrowing rate stands at 9.0 percent and the lending rate at 11.25 percent.

The BSP, which held an emergency meeting on Tuesday after the US Federal Reserve cut its target rate by 50 basis points, opted to keep the rates unchanged because of possible oil price increases in the coming weeks.

"We reviewed everything we said on Tuesday and it remains the same. Why change when there are uncertainties?" BSP Governor Rafael Buenaventura told reporters.

Asked if the bank would wait for September inflation data before considering a rate cut, he said: "Probably."

The inflation rate for August was 6.3 percent. The release of September inflation data is scheduled for Oct. 5.

The annual inflation rate in September is likely to be at 6.3-6.4 percent, Socio-economic Planning Secretary Dante Canlas said yesterday.

The annual inflation rate in Aug. was 6.3 percent.

"I do not think there’s any cause for alarm as far as the inflation rate is concerned," Canlas told Reuters on the sidelines of an economic forum.

Asked for his forecast on the September inflation, Canlas said: "I think it’s about the same (as August), 6.3 to 6.4 percent."