Bank of America (BofA) predicts that the Bangko Sentral ng Pilipinas (BSP) will only implement two rate cuts in the first half of 2025, citing inflationary pressures and potential currency volatility. This is a reduction from the previously anticipated three cuts. BofA also lowered its growth estimate for the fourth quarter of 2024 to 5.7 percent.
THE Bangko Sentral ng Pilipinas could markedly slow the pace of easing this year to just two rate cuts in the first half given inflationary pressures and possible currency volatility, Bank of America said on Wednesday.'We now think the BSP will cut its policy rate only twice in 1H25 , instead of thrice as we had previously assumed,' BofA said in a report where it also lowered its growth estimate for the fourth quarter of last year to 5.7 percent from 5.9 percent.
Inflation risks, it added, were increasing on the upside due to sticky food prices, volatile crude oil prices and a weaker peso.Consumer price growth was forecast to average 3.3 percent this year, slightly higher than 2024's 3.2 percent, and could approach 4.0 percent before the end of the year — limiting the central bank's ability to continue easing.
BANKING INTEREST RATES INFLATION CURRENCY ECONOMIC GROWTH
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