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* reuters: // realtime / verb = Open / url = cpurl: //apps.cp./Apps/cb-polls? RIC = PHCBIR% data from the 3DECI survey
* The 13 economists surveyed see no change in key rates
* C.bank has cut interest rates by 200 bp this year
* C.bank will announce its decision around 0800 GMT on Thursday
MANILA, Dec 16 (Reuters) – The Philippine central bank is expected to keep interest rates stable on Thursday, awaiting further signals on whether it needs to provide more political support to the pandemic-stricken country’s economy, a survey showed from Reuters.
All 13 economists surveyed predicted that the Bangko Sentral ng Pilipinas (BSP) will leave the interest rate on its overnight reverse repurchase service unchanged at a record low of 2.0% in its last policy meeting of the year.
“The BSP will likely wait until fourth quarter GDP and other economic indicators are ready to determine the pace of economic recovery and begin to relax again,” said Ruben Carlo Asunción, chief economist at Union Bank of the Philippines.
The BSP has cut rates by a cumulative 200 basis points this year, including a surprising 25bp reduction last month, making it one of the most aggressive central banks in the world in easing policies.
It has also provided additional liquidity support to the economy by purchasing government securities and making loans to the government.
Despite the unprecedented support from monetary policy, the economy contracted more than expected in the third quarter on a yearly basis, hit by weak demand and a slowdown in public spending.
The government now expects the economy to contract between 8.5% and 9.5% during the year, worse than the previous forecast of a 5.5% drop.
Consequently, many economists anticipate further monetary easing next year, given the government’s relatively weak fiscal support to pull the economy out of its first recession in nearly three decades.
“BSP’s monetary stance remains clearly dovish, supporting our forecast for further rate cuts early next year,” said Euben Paracuelles, Nomura’s Southeast Asian economist, who noted an additional 50bp cut in the first trimester. (Additional reporting by Shaloo Shrivastava in Bengaluru Edited by Ed Davies)
