Philippines Ends Monetary Easing In August

Thursday, the Philippine central bank ended its monetary easing that started in December 2008 as the economy showed signs of recovery from the global recession.

The Bangko Sentral ng Pilipinas held its key interest rate unchanged at a record low of 4%, in line with expectations. The interest rate on overnight lending or repurchase facility was kept at 6%.

In July, the central bank cut its key policy interest rate by 25 basis points to the current level.

Since December 2008, the central bank made a cumulative reduction of 200 basis points in its benchmark interest rate. The central bank also initiated liquidity enhancing measures.

Asian central banks have stopped cutting interest rates after seeing signs of economic recovery and demand rebound. In the second quarter, the Japanese economy grew 3.7% and China expanded 7.9%. Economic growth was 20.7% in Singapore.