Asia’s central banks react to US rate hike
(18 December 2015 – Asia) Following the US Federal Reserve’s decision to increase interest rates for the first time in nearly a decade, central banks across Asia were placed under the spotlight for their reactions.
Philippines’ central bank, Bangko Sentral ng Pilipinas (BSP) left its benchmark interest rate steady at 4.0 percent, highlighting that inflation is expected to stay within its target over the next two years.
Similarly, Bank Indonesia (BI) kept its benchmark interest rate unchanged at 7.5 percent for a 10th month.
In contrast, Taiwan’s central bank lowered its interest rate by 0.15 basis points to 1.625 percent. The decision marks the Central Bank of the Republic of China’s (CBC) second consecutive rate cut for 2015.
The Hong Kong Monetary Authority, which raised the base by 25 basis points to 0.75 percent. The move, which is expected to pressure property prices in Hong Kong, was unavoidable with the territory’s currency pegged to the greenback.
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