NDF Unfazed As BSP Gov Dials Down Rate-Hike Rhetoric, Onshore Markets Closed

USD/PHP 1-month NDF trades +0.10 at PHP55.11, showing little reaction to the latest round of comments from BSP Governor Medalla, with onshore markets shut for a special holiday in observance of the anniversary of the People Power Revolution.

• Medalla said that the central bank will most likely raise interest rates once more, most likely by 25bp. The official noted that he is hoping to be surprised on inflation.
• This comes after BSP chief said last week that the central bank will likely raise interest rates by 25bp or 50bp next month to contain broadening price pressures.
• The BSP is struggling to contain consumer prices, which rose 8.7% Y/Y last month, exceeding the estimates of all analysts polled by Bloomberg.
• Medalla's comments today appear to signal a mild dovish shift in rhetoric, with the authorities expecting non-monetary measures to help curb inflation.
• From a technical viewpoint, bulls look for USD/PHP 1-month NDF to punch through Feb 15 high of PHP55.50, with bears eyeing Feb 9 low of PHP54.43 for support.