Adds comments, details, background
MANILA, Nov 4 (Reuters) – The Philippine central bank will keep its policy accommodative for as long as necessary to guide the economy to recovery from the pandemic, its governor said on Thursday, ahead of a policy meeting later this month.
With elevated inflation seen as transitory, the central bank has ample room to continue its easy money policy, Bangko Sentral ng Pilipinas Governor Benjamin Diokno told a regular news conference.
“The priority is to maintain accommodative monetary policy as long as needed to support the economy,” Diokno said.
The central bank, which holds its next rate-setting meeting on Nov. 18, has kept interest rates PHCBIR=ECI steady at a record low of 2.0% in its last seven meetings to support the economy. nL4N2RD017
The reimposition of strict lockdown measures in the capital region and adjacent provinces in August to slow a surge in COVID-19 infections likely slowed growth in the third quarter compared with the previous quarter.
Official gross domestic product data will be released on Nov. 9.
Officials also blame the slight rise in unemployment in September to 8.9%, the highest since January, on the strict mobility curbs.
The Philippines, which was hit by one of Asia’s worst outbreaks, slashed its growth target this year to 4%-5% from 6%-7%, but the revised outlook was a turnaround from last year’s record 9.6% contraction.
A steady decline in average daily infections from a peak of over 18,500 in September has enabled the government to gradually ease curbs, with more businesses allowed to reopen. It has so far vaccinated 24% of its population.
(Reporting by Neil Jerome Morales and Karen Lema; Editing by Martin Petty)
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