Philippines cuts interest rates to boost economy

Associated Press

MANILA, Philippines (AP) — The Philippines' central bank says it has cut interest rates by a quarter percentage point to boost the economy while the inflation outlook is benign and the world economy is tipping toward a further slowdown.

Central bank Gov. Amando Tetangco said the bank's Monetary Board decided on the rate cuts Thursday.

They are the first since 2009 and follow similar moves by other emerging markets to ease monetary policy.

The interest rate paid by the central bank to lenders for overnight deposits has been cut to 4.25 percent, and the rate borrowers pay for overnight borrowing from the central bank to 6.25 percent.

Tetangco says average annual inflation is forecast to fall within the lower half of a 3 percent to 5 percent range up to 2013.

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