Growth in M3, bank loans ‘bright spot’ in PHL B C U. O @caiordinario
T Marcial books ticket to Paris—in devastating style
Eumir Felix Marcial knocks out Syria’s Ahmad Ghousoon in the second round and he’s now in the gold medal round of the men’s light heavyweight class of boxing at the 19th Asian Games and, more importantly, he’s qualified for the Paris 2024 Olympics to chase his dream gold medal. Stories on the Asian Games, B8 Sports. NONIE REYES
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HE growth in the country’s domestic liquidity (M3) and loans of universal and commercial banks (U/KBs) remained a “bright spot” for Philippine economic performance, according to a local economist. Data from the Bangko Sentral ng Pilipinas (BSP) showed M3 grew by 6.8 percent year-on-year to about P16.5 trillion in August from 5.7 percent in July. BSP data also showed that loans of U/KBs increased 7.2 percent year-on-year in August from 7.7 percent in July 2023. “M3 growth at 6.8 percent, similar/slightly slower vs. UKB/KB
loans growth at 7.2 percent, both of them slowed down in recent months, but still faster than GDP/ economic growth, so a good sign/ bright spot for the economy,” Rizal Commercial Banking Corporation Chief Economist Michael L. Ricafort told BM. Ricafort noted that the growth in M3 was among the slowest in over a decade due to “restrictive monetary policy.” The Monetary Board maintained its key policy rates at 6.25 percent for the fourth consecutive time this year. The economist said the growth in M3 may also reflect the “excess liquidity in the financial system.” Ricafort noted that there were large bids in BSP’s weekly Term Deposit Facility and securities auc-
tions. “Also after the recent decline in the BSP 1-day/ON average auction rate to 6.14 percent [lower vs. the local policy rate of 6.25 percent], as this could also indicate the excess liquidity in the financing system, with relatively large bids above P500 billion per day in most days recently since this daily auction started on September 8,” Ricafort also said. The BSP said domestic claims expanded by 9.1 percent year-onyear in August from 8.9 percent in the previous month. Claims on the private sector grew by 7.3 percent in August from 8.2 percent in July, driven by the sustained expansion in bank lending to non-financial private corpo-
rations and households. Net claims on the central government rose by 14.7 percent in August from 12.5 percent in July due mainly to the borrowings by the National Government. Net foreign assets (NFA) in peso terms increased by 3.2 percent year- on-year in August following a 2.6-percent decline in July. The BSP’s NFA grew by 3.2 percent in August after contracting by 0.5 percent in the previous month. Similarly, the NFA of banks went up on account of lower bonds payable. “Looking ahead, the BSP will continue to ensure that domestic liquidity conditions align with its S “G,” A
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‘VOLATILE-PRICE’ AREAS TO GET RICE AID—PBBM ■
PAYOUT
Senate Majority Leader Senator Joel Villanueva spearheaded the payout activities of the Department of Social Welfare and Development (DSWD) Assistance to Individuals in Crisis Situation (AICS) in Santa Rosa City, Laguna, and the DSWD AICS Payout along with the Department of Labor and Employment (DOLE) Tulong Panghanapbuhay sa Ating Disadvantaged/Displaced Workers (TUPAD) payout in Biñan City, Laguna. The initiatives benefited a total of 800 individuals in Santa Rosa City and 1,000 beneficiaries in Biñan City. The event was attended by Santa Rosa Mayor Arlene Arcillas and Laguna 4th District Rep. Dan Fernandez. ROY DOMINGO
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FTER finally lifting the monthlong rice price cap on Wednesday, President Ferdinand R. Marcos Jr. said the government will provide aid for vulnerable groups in areas where the price for the food staple remains “volatile.”
The chief executive made the announcement in an interview with reporters after the distribution of rice in Taguig City. “As of today we are lifting the price caps on the rice both for the regular milled rice and for the wellmilled rice. So we are now removing the [price] control now,” Marcos said. Last month, the President issued Executive Order No. 39, which imposed a P41 per kilogram (kg) price ceiling for regular milled rice (RMR) and P45 per kg for wellmilled rice (WMR). Marcos said the measure aims to address the unusual surge in the price of rice during the period, despite the country’s sufficient supply of the food staple. He attributed the trend to the price manipulation by hoarders and smugglers. The lifting of EO 39 was recommended by the Department of Agriculture (DA) and the Department of Trade and Industry (DTI)
and backed by the National Economic and Development Authority (Neda).
Government assistance
HOWEVER, the President gave assurances that the government will continue to provide assistance to those who live in areas where rice price remains high, particularly the National Capital Region (NCR). “When we looked at the statistics yesterday, the problem is really in NCR. It is here, where the price of rice is high. In other areas, when you look at the price [of rice], they are already lower than the price cap,” Marcos said. Based on the price monitoring of the Department of Agriculture in NCR, the price of RMR in the region ranges from P40 to P44 per kilogram (kg), while for WMR, it ranges from P44 to P48 per kilogram.
AMRO CUTS ’23 GDP FORECAST, IMF sees MIF as tool to fill SAYS TIGHT POLICY MUST STAY PHL infra gaps, DBM says B C U. O @caiordinario
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HE tight monetary policy of the Bangko Sentral ng Pilipinas (BSP) should be maintained until inflation slows, as far as the Association of Southeast Asian Nations (Asean) Plus 3 Macroeconomic Research Office (Amro) is concerned. In its latest economic update, Amro said the country’s economic growth will slow to 5.9 percent in 2023 from its July estimate of 6.2 percent. However, it kept growth estimates at 6.5 percent for next year, the same rate it forecasted in July. In terms of inflation, Amro expects the country’s inflation rate to average 5.5 percent this year, slower than the 5.9 percent it initially estimated. It also maintained its inflation outlook at 3.8 percent for 2024. “In the Philippines, the central bank raised its policy rate to curb rising inflation and the emergence of second-round effects. Given these three economies’ [Philippines, Korea, and Singapore] midand late-cycle positions, Amro staff recommends that their cen-
tral banks maintain a tight monetary policy stance until inflation pressures subside,” the Amro report stated. Amro Chief Economist Hoe Ee Khor said on Wednesday that he expects the BSP to maintain its tight monetary policy. He said this stance may continue for as long as inflation has not eased. Some of the factors that could push inflation, Khor said, include a worse-than-expected El Niño phenomenon which could again lead to higher food prices. Food has a 34.78-percent weight in the Consumer Price Index (CPI) for all households and 51.38 percent in basket of goods for the Bottom 30 percent of the population. “I think even the [BSP] Governor has expressed that inflation will have to stay high until inflation comes down to meeting the inflation target band. And he has not ruled out the increase, if necessary,” Khor said in a virtual briefing on Wednesday. Last week, the BSP said it intends to raise interest rates anew in its next meeting and maintain this rate until the end of the first se-
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HE Department of Budget and Management (DBM) said the International Monetary Fund (IMF) is supporting the Maharlika Investment Fund (MIF), noting that it would help in “closing” the Philippines’s infrastructure gaps and boost its “green” in-
vestments. “The Maharlika Investment Corporation [MIC] could contribute to the push for closing infrastructure gaps and green investments by following best practices in strategic A
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PESO EXCHANGE RATES US 56.8800 ■ JAPAN 0.3816 ■ UK 68.6940 ■ HK 7.2625 ■ SINGAPORE 41.4185 ■ AUSTRALIA 35.8401 ■ SAUDI ARABIA 15.1660 ■ EU 59.5363 ■ KOREA 0.0418 ■ CHINA 7.7779 Source: BSP (October 4, 2023)