BSP EYES MIDDLE EAST IMPACT ON INFLATION, PESO AHEAD OF APRIL RATE MEETING
MANILA — The Bangko Sentral ng Pilipinas said Thursday it is closely watching the fallout from the ongoing Middle East conflict on Philippine inflation, remittances, and financial markets, as it prepares for its next monetary policy meeting next month.
The central bank expressed hope for the safety of overseas Filipino workers and other civilians caught in the conflict zone, even as it assessed the broader economic risks the crisis poses to the country.
“Price stability is the BSP’s main mandate,” the central bank said, noting it is evaluating how higher global oil prices could feed through to fertilizer costs, transport fares, and overall consumer prices.
The BSP said it is also tracking the conflict’s effects on the current account, including trade flows and remittances sent home by the millions of Filipinos working abroad — a vital source of foreign exchange for the Philippines.
On the peso, the BSP reiterated that it intervenes in the foreign exchange market solely to smooth excess volatility and preserve orderly conditions, consistent with its flexible exchange rate policy. It stressed that such intervention is aimed at tempering sharp swings that could stoke inflation, not at defending any specific exchange rate level.
The central bank’s policy-setting Monetary Board is scheduled to meet on April 23 to review benchmark interest rates. Officials said decisions would continue to be guided by incoming data.
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