Bangko Sentral ng Pilipinas Governor Amando Tetangco Jr. said Thursday the latest move of the US Federal Reserve to keep interest rates steady will be one of the major factors the Monetary Board will consider in its policy meeting next week.
Tetangco said in a mobile message the Fed’s relatively positive outlook on the US economy suggested it was on track with policy tightening this year.
“This is roughly consistent with what we have incorporated in our baseline scenario. We will note this development at our policy meeting next week, as well as the inflation outlook over the policy horizon,” Tetangco said.
The US Fed on Feb. 1 kept the benchmark interest rate unchanged in its first policy meeting since President Donald Trump took office.
The Monetary Board, the policy-making body of Bangko Sentral, kept the benchmark interest rates steady on Dec. 22 due mainly to manageable inflation environment and sustained domestic economic growth.
Tetangco said the domestic demand conditions were likely to stay firm, backed by solid private household spending, higher government expenditures, and adequate domestic liquidity. The economy grew 6.6 percent in the last quarter of 2016, bringing the full-year average to 6.8 percent.