The Bangko Sentral ng Pilipinas (BSP) said it is now time to put into effect plans to invest and start businesses amid slashing of interest rates. The BSP has cut interest rates to a record low of 175 basis points, bringing policy rates to 2.25 percent.
Aside from e-commerce growth, the Central Bank said it has exhausted its monetary tool kit to make loans affordable for banks and their clients since the start of the pandemic.
“If you are an investor, may idea ka na business na gusto i-fund ngayon, punta ka sa bangko at manghiram ka ng pera (If you are an investor, you have business ideas you want to be funded, go to the banks and borrow money),” BSP Gov. Benjamin Diokno advised.
“For as long as we’re afraid to consume, to buy, we’re afraid to invest, we are afraid to produce, walang mangyayari sa ekonomiya natin (nothing will happen to our economy),” he added.
Meanwhile, the inflation outlook remains benign for the next years compared with that of other countries which registered high inflation due to COVID-19. The Central Bank said it is only expecting the local inflation rate to settle at two to four percent in the next three years.
The BSP also issued a reminder that banks cannot impose interests or penalties on loans that fell under the quarantine period. Clients may talk with banks since the BSP has been helping the latter “through some relief measures” to help clients in case they have difficulty paying loans. – Report from Naomi Tiburcio