Balisacan says rate hike is not needed despite Sept. inflation
By Robina Asido
National Economic Development Authority (NEDA) Secretary Arsenio Balisacan said he does not agree interest rates would have to be raised after September inflation reached 6.1 percent.
"If I were on the Monetary Board, I would say no because we have been the most aggressive in our region in raising interest rates. That was clear in the data of the (International Monetary Fund) IMF report," he said.
"We know that raising the interest rates will hurt the economy, will hurt consumers, will hurt the producers and that has also long term effects now," he added.
Following the increase in the inflation rate, the central bank said it is'' ready to resume monetary policy tightening to prevent price pressures from broadening and to arrest the emergence of additional knock-on effects in view of persistent upside risks to the inflation outlook."
The central bank added that the "latest data suggests that inflation is likely to remain elevated in the coming months, due to the continued impact of supply shocks on food prices and the rise in global oil prices, before decelerating back to the target range by Q4 2023 in the absence of further supply shocks".
Balisacan stressed that "there is really no no urgency in creating another round of high interest rates".
"That higher interest rate will really put us quite away from our peers in the region," he said. DMS
