Weekly Updates

culture Assistant Secretary Rex Estoperez warns that rice inventory will suffer if farmers in rain-fed areas are unable to plant due to El Niño. The retail price of rice is expected to rise amid high farm gate prices and increasing imported rice costs.

culture Assistant Secretary Rex Estoperez warns that rice inventory will suffer if farmers in rain-fed areas are unable to plant due to El Niño. The retail price of rice is expected to rise amid high farm gate prices and increasing imported rice costs.

The BSP hiked the benchmark interest rate by 25 bps, in line with expectations, and signaled a likely pause at its next meeting in May. This brought the rate on the overnight reverse repurchase facility to 6.25%. Meanwhile, the rates on the overnight deposit and lending facilities were also raised by 25 bps to 5.75% and 6.75%, respectively. According to BSP Chief Medalla, the Monetary Board may no longer raise borrowing costs at its May 18 meeting if March inflation turns out better-than-expected and slows down from 8.6% in February. In addition, the BSP trimmed its inflation projections to 6% (from 6.1%) and 2.9% (from 3.1%) for 2023 and 2024, respectively.

The Bangko Sentral ng Pilipinas (BSP) has confirmed that the Philippine banking sector is well-equipped to tackle possible effects of the US banking crisis. They commented that, compared to US banks, Philippine banks have a more stable asset base and loans that are less sensitive to changes in fair value. Furthermore, PH banks have higher liquidity and deposits, resulting in a lower risk relative to those in the US. SVB’s security holdings in proportion to its capital are larger than that of PH lenders. Lastly, the BSP added that they will continue monitoring developments closely and there is no material exposure outside the country for PH banks.

Data from the PSA showed that the unemployment rate hit 4.8% in January amid the loss of temporary holiday jobs, equivalent to 2.37 mln jobless Filipinos. This was the highest since the 5% seen in September 2022 but lower than 6.4% a year ago. Meanwhile, job quality worsened MoM as underemployment reached 14.1% from 12.6% in December, but improved YoY from 14.9%. January’s labor force shrank to 49.7 mln from 51.2 mln, which lowered the labor force participation rate to 64.5% from 66.4% in December