The Monetary Board reduced the BSP’s target reverse repurchase rate by 25 basis points to 5.0 percent at its monetary policy meeting on 28 August 2025. Correspondingly, the rates on the overnight deposit and lending facilities were adjusted to 4.5 percent and 5.5 percent, respectively. Read more

The inflation outlook remains moderate over the near term. Inflation is projected to remain below the target range until Q4 2025. Compared with the previous round, the inflation projection for 2025 is slightly higher. This reflects the spillover effects of typhoons in July and the potential adverse impact of the approved rice import ban. Read more

Headline inflation eased further in July 2025 to 0.9 percent, the lowest since October 2019 (0.6 percent). Domestic rice prices eased owing to lower international rice prices, sufficient supply, and direct government measures. Downward adjustments in the prices of some petroleum products and the slower electricity inflation likewise tempered inflation. The July inflation outcome was within the BSP’s month-ahead forecast range of 0.5–1.3 percent. Read more

The Bangko Sentral ng Pilipinas (BSP) conducts an annual evaluation of its forecast performances as part of its continuing efforts to enhance its suite of macroeconomic forecasting models and to promote transparency in monetary policy formulation.

This box article summarizes the BSP’s forecasting performance for 2024, focusing on (a) month-ahead inflation forecasts, (b) annual inflation forecasts, and (c) standard statistical tests and peer benchmarking.

Compared to 2023, forecast errors in 2024 were lower for both month- and year-ahead forecasts, reflecting a more accurate assessment of evolving price conditions amid easing supply pressures and reduced volatility. Read more

This article explores the influence of recent shifts in liquidity and deposit trends on shaping loan growth in the Philippine banking system. Specifically, it analyzes the roles of both sides of the bank balance sheet: on the asset side, how variations in the composition of liquid assets—such as cash, central bank deposits, and government securities (GS)—affect banks’ lending behavior; and on the liability side, how different deposit types shape loan growth, with emphasis on dynamics during the pandemic. Read more