MANILA, Oct 26:
The Philippine central bank expects annual inflation in October to be at 2.9 to 3.8 percent, with the bottom end of the forecast the lowest in four months, as ample food supply and a strong peso helped offset higher power costs.
‘The forecast supports our expectation of benign inflation over the policy horizon and should keep interest rates low for some time,’ Governor Amando Tetangco told reporters in a mobile text message on Friday.
Annual inflation slowed to 3.6 percent in September, bringing the average inflation rate in 2012’s first nine months to 3.2 percent, near the bottom of the central bank’s 3 to 5 percent target band for the year.
The Bangko Sentral ng Pilipinas cut its key policy rate for a fourth time this year on Thursday to help manage capital inflows that have kept the peso rising against the U.S. Dollar and to boost growth amid weak external demand.
The 25 basis point cut brought the overnight borrowing rate to a new low of 3.50 percent.
(agencies)
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