Philippines’ central bank governor favours matching Fed hike

THE Philippines’ Central Bank governor Felipe Medalla repeated on Tuesday (Oct 25) he would vote to match the policy move of the US Federal Reserve (Fed), which is expected to deliver another 75 basis-point rate hike at its meeting next month.

“If I am the only one voting, I will match the next Fed increase,” Medalla, who heads the seven-person policymaking monetary board, told a banking forum.

The Bangko Sentral ng Pilipinas’ (BSP) penultimate meeting this year will be on Nov 17, about a week after the Fed’s Nov 2 policy review where it is forecast to go for its fourth consecutive 75 bps rate hike to tame inflation.

Medalla said the BSP could afford to be more aggressive in its policy tightening to support the peso, and added the economy is strong enough to absorb the impact of higher rates.

“I personally believe we must be a little bit more aggressive in increasing rates also because I think the economy can withstand it,” Medalla said. REUTERS