Central bank receives mixed signals from IMF

MANILA, Philippines - The Philippine agency mandated to control inflation said that it is receiving mixed signals from various multilateral institutions. In an email message, the head of the Bangko Sentral ng Pilipinas (BSP) said that institutions such as the International Monetary Fund (IMF) “talk of one thing and mean another," referring to policy advice dispensed by the Washington-based organization. Earlier, the IMF cited the BSP’s efforts in controlling high prices without curbing economic expansion. However, Takatoshi Kato, the IMF’s deputy managing director, said that Indonesia, Vietnam, and the Philippines “appear to have fallen behind the curve in terms of their interest rate policy." Kato was referring to the recent decision of monetary officials to hike interest rates to control high prices, the first time it applied growth curbs in two years. The decision underscored the dilemma faced by monetary officials around the world that involves striking a balance between keeping goods prices stable without reducing economic growth. “From a monetary policy standpoint, my message to international organizations, if they want to be helpful, they have to be consistent with the assessment they provide to member countries," BSP Governor Amando M. Tetangco said. Tetangco, who heads the influential seven-member monetary board, was apparently stung by Kato’s comments on Philippine inflation during the Asia-Europe Finance Ministers’ meeting in South Korea. - GMANews.TV