Overseas news
Japan’s economy exceeded forecasts as it grew by an annualized rate of 2.8% in Q4. The growth was supported by improvements in business spending and consumption, which may strengthen the case for further rate hikes.
Raising key rates is a tool that a central bank may use to manage inflation, which tends to speed up during times of economic growth.
Higher interest rates make borrowing more expensive and can slow down economic activity.
In the UK, Bank of England Governor Andrew Bailey said inflation is slowing, and a forecasted increase later this year is unlikely to last.
He attributed the rise to regulated price hikes while noting that economic sluggishness could help keep inflation in check.
Central banks look at their respective country’s economic conditions when deciding what to do with key interest rates. They may increase rates to control inflation or cut them to stimulate economic growth.
Local developments
Cash remittances from overseas Filipino workers (OFWs) reached an all-time high of $34.49 billion in 2024, said the Bangko Sentral ng Pilipinas (BSP). This marks a 3% increase from $33.49 billion in 2023.
In December alone, remittances hit a record monthly high of $3.38 billion, also up 3% year-on-year. Remittances bring a crucial financial flow to the Philippines as they help increase the amount of money that is spent and saved locally.
Meanwhile, the Philippine Ports Authority (PPA) reported a 3.2% increase in 4th quarter cargo volume to reach 71.2 million metric tons (MMT), driven by foreign shipments.
The higher cargo volume may hint at increased local demand, which can contribute to economic growth if spending rises to match.
Additionally, the World Bank plans to lend the Philippines $2.75 billion in fiscal year 2026, 3.7% lower than the $2.857 billion allocated for 2025.
A new country partnership framework for the Philippines covering 2025-2028 is also being finalized, according to World Bank Country Director Zafer Mustafaoğlu.
This new lending program is aimed at strengthening the country's human capital, disaster resilience, and environmental sustainability.
The latest news shows no hint of big changes happening right away. You may want to remain cautious with your investing decisions for now.
