Bloomberg News

Philippines May Gradually Cut Reserve Ratio on Growth, Spending

October 27, 2011

Oct. 27 (Bloomberg) -- The Philippine central bank will consider reducing banks’ reserve requirement ratio once government spending picks up and economic growth accelerates, Deputy Governor Diwa Guinigundo said in an interview.

“If infrastructure spending goes up, we will lower the reserve requirement” currently at 21 percent, Guinigundo said in Manila today. Bangko Sentral ng Pilipinas, which will hold its final rate-setting meeting on Dec. 1, will consider developments in Europe and in the U.S., the official told a forum. The Philippines will continue to build up international reserves “as buffer against external shocks,” he said. The monetary authority is working to “streamline” the process of registering foreign-exchange in its bid to facilitate flows, Guinigundo said.

To contact the reporter on this story: Norman P. Aquino in Manila at naquino1@bloomberg.net

To contact the editor responsible for this story: Clarissa Batino at cbatino@bloomberg.net


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