MONETARY authorities could shelve a plan to cut key interest rates next month given the likely impact of a recent typhoon and still-high rice prices, ING Manila Bank said.
'So far, the cut in rice tariffs in early July seems to have had no discernible impact on Philippine retail rice prices, and the recent typhoons may push other seasonal food prices higher in the meantime, so we may need to wait to see the impact of lower tariffs on food prices and inflation more generally,' ING Manila said in a commentary.
Rice losses were estimated at 10,272 MT valued at P660.6 million.BSP Governor Eli Remolona Jr., however, has said that the calamity will not affect July inflation number as 'usually the effects come with a lag, so it may not even affect August in terms of the aggregate CPI basket.'The central bank's policymaking Monetary Board remains on track to start cutting rates next month as inflation is expected to have peaked in July, he said on Tuesday.
Food Prices 'Could Put Lid' On BSP's Rate Cut Plan
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