THE Bangko Sentral ng Pilipinas (BSP) monetary board believes that the local economic growth appears to be gaining “solid traction,” driven by improved mobility and sentiment, according to the highlights of its recent policy meeting published on Thursday.
The highlights of the meeting showed the BSP’s policy making body sees calibrated easing in quarantine protocols and progress in the government’s vaccination rollout as drivers in the pickup of growth in the economy.
The BSP report also showed that the higher-than-expected gross domestic product (GDP) print in the third quarter of this year and the expected boost from election spending in the first half of the year will also help push the country’s economy.
Overall, the BSP reiterated its outlook that the country’s real GDP will return to its 2019 level by the third quarter of 2022.
The BSP monetary board noted that mobility indicators have trended upward in recent months, noting that mobility data from Google are at an all-time-high since March 2020 mirrored in the near-normal congestion levels for Manila.
In their latest meeting in November, the BSP monetary board opted to keep monetary policy rates unchanged at record low levels to support the recovery of the economy. The BSP has been keeping this accommodative stance on hold for the entire 2021.
In his speaking engagements earlier this year, BSP governor Benjamin Diokno said they will only consider pulling back the accommodative stance once they see clear signs of recovery in the economy.
“The BSP will withdraw monetary support only when there are indisputable signs of solid economic recovery amid a manageable inflation environment, as well as a sustained downtrend in community transmission of the virus,” Diokno earlier said.
The BSP monetary board will hold its next – and last for the year — monetary policy meeting on December 16.