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MNI BSP Preview - August 2021: BSP Speak Galore Ahead Of Stand-Pat Meeting

EXECUTIVE SUMMARY

  • Bangko Sentral ng Pilipinas said recently that trimming the RRR is "on the table," but Governor Diokno promptly played down potential for an imminent move, noting that reducing the rate now would be "untimely and unjustified".
  • Mobility restrictions including a strict lockdown in the National Capital Region weigh on economic recovery, while the Delta coronavirus variant rages.
  • CPI has only just returned to the upper end of BSP's target range, while credit growth remains subdued, undermining effective policy transmission.
  • The Monetary Board are expected to leave interest rates unchanged on Thursday and maintain accommodative monetary conditions until they see signs of sustainable economic recovery.

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