BSP seen set for jumbo 50-bp rate hike to 5%

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MANILA, Philippines – The Bangko Sentral ng Pilipinas’ (BSP) next move against war-driven inflation could be a jumbo half-point rate hike, according to Deutsche Bank Research, which pointed to increasingly hawkish signals from Philippine monetary officials.

In a note to clients, Deutsche Bank said the outsized increase could come either through an off-cycle move or at the BSP’s scheduled policy meeting on June 18.

READ: BSP seen delivering ‘measured’ rate hikes

The revised outlook marks a shift from the bank’s earlier base case of 25-basis-point (bp) hikes in both the June and August meetings. Deutsche Bank said the change was prompted by Governor Eli Remolona Jr.’s remark that the BSP was “considering” an off-cycle rate increase.