BUSINESS

By Julito G. Rada

THE Bangko Sentral ng Pilipinas may raise the overnight borrowing rate to 6.5 percent or even higher this year if core inflation does not show signs of cooling down, according to Hongkong and Shanghai Banking Corp.

“We argued previously that the crux for monetary policy moving forward will be core CPI [consumer price index]. And we think core CPI can still be punchy in March and April given that its momentum hasn’t shown any signs of letting up,” HSBC said in a comment

Grab PH expands services in Iloilo

GRAB Philippines said Friday it expanded its services in Iloilo as part of its commitment to the government to provide 500,000 new livelihood opportunities within the transport sector across the country.

“The launch of GrabCar in Iloilo is a very exciting time as this marks the beginning of our journey towards delivering hundreds of thousands of meaningful livelihoods to our kababayans,” Grab Philippines country head Grace Vera Cruz said.

“We aim to delight our Ilonggo locals and tourists, and deliver the very best service to our consumers as well as our driver and merchant partners. We also hope to be a catalyst of digitalization for many of our Ilonggo institutions and become part of everyday life,” she said.

Grab is present in Iloilo with GrabTaxi, GrabFood and GrabExpress. Since launching its deliveries business last 2020, GrabFood became Iloilo’s most beloved food delivery platform.

Grab is a major source of livelihood in the Philippines, and through the launch of its GrabCar service, Grab is looking to make a positive contribution to the local economy— both as a provider of transport services, and as a livelihood partner.

G. Amojelar

Darwin

BOI encourages Taiwan firms to invest in PH

THE Board of Investments encouraged Taiwanese companies to expand their business portfolio by investing in the Philippines.

Trade Undersecretary and BOI managing head Ceferino Rodolfo said the Philippines has much to offer to Taiwanese companies.

“The Philippine economy has shown strong growth momentum, evident in our improved economic performance in 2022. Moreover, we are home to a highly skilled and innovation-ready workforce who can successfully and efficiently drive company’s operations. The Philippine government also continues to improve its business climate through game-changing laws, such as CREATE Act, to make it easier to do business in the country,” he said.

Rodolfo said strong investment sentiments are coming from Japan, South Korea and Taiwan. As the world shifts to green solutions and finding more sustainable sources of energy, these economies see the Philippines as the best location to host their renewable energy projects, he said.

“We are near the equator which is ideal for solar projects; our many islands are the perfect destination for offshore wind and tidal energy projects. We also have an abundance of green minerals such as nickel, cobalt, and copper, which are key to going into cleaner energy applications such as renewable energy, electric vehicles, and battery technologies,” he said. Othel V. Campos

Basic launches electric vehicle charging station

BASIC Energy Corp. said Friday it launched an electric vehicle charging station at the EcoOil Station along EDSA Southbound.

BEC said wholly-owned subsidiary Basic Energy Renewables Corp. teamed up with Ecology Energy Corp., owner of the EcoOil fuel stations for the “Basic Recharge Station.”

The EV charging station will service EV motorists who now own or are considering to acquire EVs “to benefit from the growing shift to a transport landscape that is both environmentally impactful and economical.”

BEC, in partnership with several oil companies that operate a network of service stations across the archipelago, committed to expanding the reach of “Basic Recharge Station.”

The EV station offers rapid and fast EV chargers, a 60-kW charger with CCS2 connectors and a 20-kW GBT charger to answer the varying standards of EV charging systems for most makes and models being introduced to the Philippines. Alena Mae S. Flores after the BSP raised the key policy rate by 25 bps [basis points] to 6.25 percent on Thursday.

London-based Oxford Economics also said that while inflation edged down to 8.6 percent in February from 8.7 percent in January, it remained above the 4-percent upper ceiling of the target, which led the BSP to raise rates.

“We expect the BSP to raise the policy rate again by 25 bps at its May meeting, before holding the rate at that level throughout the year. We look for inflation to trend down barring another supply shock, which will make the BSP comfortable staying put. However, risk of further/bigger hikes cannot be ruled out if the peso depreciates a lot given ongoing external pressures,” Oxford Economics said.

The think tank said while inflation was expected to come down as food and energy prices eased due to resolving supply-side pressures, the pace of decline would be gradual. “We think average inflation for the year will settle at 5.8 percent, unchanged from last year. But what is important is that the sequential momentum will moderate, which will ease pressures on the BSP to continue hiking,” it said.

HSBC agreed that the BSP would keep hiking interest rate as core inflation continued to be elevated. “Thus, we expect the BSP to increase its policy rate by 25 bps in May to 6.50 percent which we think will be the last rate hike before pausing,” the bank said.

“However, if core CPI rises further than expected, there is a risk that the BSP will push interest rates higher than 6.50 percent,” it said. Economists said core inflation better represents the underlying trend of inflation. In the Philippines, it accelerated to 7.8 percent year-on-year in February from 7.4 percent in January, which was the highest level since 1999.

Core inflation is the change in prices of goods and services, excluding those from the food and energy sectors.

Medalla said in an interview with CNBC Asia monetary authorities started to breathe a sigh of relief, knowing that they were not alone in fighting the elevated inflation that blew past the target range of 2 to 4 percent last year.

Medalla said inflation in the country was largely due to—aside from oil— “very protectionist agricultural policies.”