Philippines Central Bank Keeps Benchmark Rate Steady at 6.5%

CREDIT INTEREST RATE - MANILA. The Philippine central bank kept its policy rate steady at 6.5% on Thursday, saying the inflation outlook has moderated.

Sixteen of 23 economists in a Reuters poll had expected the Bangko Sentral ng PIlipinas (BSP) to keep its benchmark interest rate unchanged, while the rest had predicted a hike of 25 basis points.

"Keeping policy rates steady will allow previous rate adjustments to continue to work their way through the economy," the central bank said in a press briefing.

Thursday's decision to leave rates unchanged followed the central bank's off-cycle 25 basis point hike on Oct. 26.

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Ahead of the policy rate decision, Bangko Sentral ng Pilipinas (BSP) Governor Eli Remolona told an economic briefing in San Francisco inflation could ease back to the 2%-4% target range next year but the country is "not out of the woods yet".

Annual inflation slowed for the first time in three months in October, to 4.9% from 6.1% in the previous month, but the central bank said on Thursday risks to the inflation outlook were tilted to the upside.

BSP's next scheduled meeting is on Dec. 14, its last for the year.