Philippine monetary board cuts rates by anew, defends governor

In another aggressive move, the Philippine monetary board lowered key interest rates by another 50 basis points even as Bangko Sentral (central bank) defended its governorÆs right to the post.

The rate cuts will be effective from Monday, 12 February. This recent action brings the cumulative reduction to 400 points since 4 December 2000, wiping out all the rate increases since 13 October, when the peso tumbled at intensifying news of Estradas alleged involvement in gambling and corruption.

After the cut, the overnight RRP reverse repo rate will be 11.0% while the RP repurchase rate will be 13.25%. This is the fifth rate cut for the year.

The tier system for overnight placement by banks under the RRP window will be maintained. For placements up to Ps5 billion $104 million, the rate will be 11.0%, for the next Ps5 billion it will...

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