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MNI BSP Preview - May 2022: Rate Hike Firmly On The Table

EXECUTIVE SUMMARY

  • Data released last week provided further evidence of ongoing economic recovery, as Q1 GDP growth printed well above expectations and output surpassed its pre-pandemic levels.
  • Inflation breached the upper end of the BSP's target range in April. While supply-side pressures play a significant role, the risk of second-round effects is growing.
  • Our base-case scenario is for Bangko Sentral to deliver the first rate hike since the outbreak of the pandemic of COVID-19. While a delay remains a possibility, it would provide a dovish surprise.

Click to access the full preview: MNI BSP Preview May 2022.pdf

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