Philippine central bank may keep rates steady

The Philippine central bank has scope to keep its policy rate at a record low, with inflation seen benign up to at least early 2011 and growth expected to moderate next year, the economic planning chief said on Thursday. The central bank holds a rate-setting meeting on December 29 and analysts widely expect monetary authorities to hold off any rate hikes until 2011, according to a Reuters poll last month.
Annual inflation climbed more than expected in November but was still on course to be within the government's average target range of 3.5 to 5.5 percent. The peso rose to a 2-1/2 year high against the dollar in early November due to large capital inflows, but it has since eased from those levels after the central bank let some of its forward swaps mature, creating a dollar shortage in the market.