FxWirePro: Daily Commodity Tracker - 21st March, 2022 
BOJ Rate Decision in Focus as Sticky Inflation, Weak Yen Shape USD/JPY and Nikkei Outlook 
BOJ Expected to Hold Rates Steady While Signaling More Hikes Ahead 
RBA Signals More Rate Hikes Possible as Australia Battles Stubborn Inflation 
Singapore Raises 2026 GDP Growth Forecast to 4.5%-5.5% as AI Boom Fuels Economy 
China Holds Loan Prime Rates Steady for 14th Month as Economic Recovery Remains Uneven 
US Dollar Near Two-Month Low as Markets Await Inflation Data 
US Stock Futures Flat as Iran Strait of Hormuz Demands Fuel Oil Concerns 
US Yen Intervention Unlikely to Deliver Lasting Recovery, Yardeni Says 
Japan Executives Warn Weak Yen and Currency Volatility Threaten Economy 
The central bank of Philippines kept its policy stance unchanged at the monetary policy meeting held Thursday, revising upward the country’s future inflation forecast. The central bank is expected to tighten its policy tools by Q3 2017 on the back of a likely boost from increased infrastructure spending.
The Bangko Sentral ng Pilipinas (BSP) left its policy tools unchanged, with the overnight policy rate at 3.00 percent, overnight deposit rate at 2.50 percent, and reserve requirement ratio at 20 percent. The central bank also revised upwards its inflation forecasts to 1.8 percent for 2016, 3.0 percent for 2017 and 2.9 percent for 2018 (from 1.7, 2.9, and 2.6 percent respectively).
Despite the resilience in domestic demand, headline inflation numbers have been slow to rise. While 2016 inflation will likely remain below the central bank’s target range, inflation in 2017 and 2018 is expected to slowly rise back to target.
Further, Credit growth has remained resilient, in line with the growth in private investment. Loan growth rose to 16.4 percent y/y in September, with the growth contribution of the real estate and construction sectors broadly steady. Loans to manufacturing are rising in line with strength in industrial production.
"We expect the BSP to be the first central bank in the region to tighten its policy tools by Q3 2017. We expect GDP growth to have remained robust at 6.9 percent y/y in Q3, marginally lower from the 7.0 percent print in Q2," ANZ commented in its latest research report.
The robust expansion in industrial production amidst persistent contraction in exports suggests that domestic demand provided an offset. Growth in government spending moderately eased after the elections in May, leading to a sequential easing to 1.5 percent q/q on a seasonally adjusted basis, from 2.3 percent in Q2.
Meanwhile, the central bank has more time to facilitate the gradual migration of excess liquidity to its new term deposit facility (TDF).
