BSP...

The anticipated September rates’ increase by the US Fed did not happen as there remains uncertainty in the pace of global economic growth.

Based on reports, US Fed chair Janet Yellen opted to wait because of the “heightened uncertainty abroad.” Still, there is indication that the US may still tweak policy stance before 2015 closes.

Tetangco said at this time, they think domestic inflation is still on track and liquidity is contained despite external conditions. “The BSP’s preemptive tightening moves last year remain relevant and domestic demand appears steady still,” he reiterated.

“We will watch market price action to see how market is digesting the Fed move (as well as) check for impact of portfolio flows on domestic liquidity and evaluate new inflation forecasts to see if there is need to fine tune policy levers or communication,” added Tetangco. The next Monetary Board policy meeting is next week, September 24.