Thursday, October 04, 2007
Central bank cuts key rates by 25 basis points (5:47 p.m.)
MANILA -- The Philippine central bank cut its key interest rates by 25 basis points Thursday, taking cues from a benign inflation outlook and the US Federal Reserve's rate cut last month.
The central bank's overnight borrowing rate was cut to 5.75 percent, while the lending rate was cut at 7.75 percent. Rates were last cut in July.
"In deciding to cut policy rates, the Monetary Board considered the benign inflation outlook," said Amando Tetangco, governor of the central bank.
He said the bank also took into consideration the steady deceleration of liquidity growth, and the steady appreciation of the peso, which has risen to seven-year highs against the US dollar.
A reduction in interest rates is expected to encourage people to borrow more money and increase their purchases. (AP)
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