Philippine Central Bank Chief Sees No Rate Hike in First Half

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The Philippines’ central bank is unlikely to increase policy rates in the first half of this year as it waits for the economic recovery to become entrenched and unemployment to fall, according to central bank Governor Benjamin Diokno, Bloomberg News reported. “After the performance in the first two quarters of the year, that’s when we seriously look at whether we will make some adjustments,” Diokno said in an interview Tuesday. “We want to make sure that the economy is recovering well.” Like central bankers globally, Southeast Asian policy makers are juggling the prospects of a faster U.S. rates liftoff and the threat from a quick-spreading coronavirus variant, as well as regional developments such as the People’s Bank of China pledging greater support for its economy and sustaining accommodative policies. The governor said the Bangko Sentral ng Pilipinas typically likes to see four to six quarters of steady economic growth and unemployment around 5% before considering raising rates. Gross domestic product has posted two consecutive quarters of year-on-year growth -- including, most recently, 7.1% expansion in the July-September period -- while the unemployment rate hit 6.5% in November, the lowest since the pandemic began. Read more.