Bangko Sentral ng Pilipinas (BSP) Governor Felipe M. Medalla said that the Philippine economy is facing risks from elevated inflation and a possible reimposition of restrictions to curb a surge in COVID-19 infections. Though Medalla said that the economy will sustain its recovery amid these challenging times, he noted that quarterly private consumption expenditures have surpassed the pre-pandemic levels already and continue to grow as the economy further opens up. Medalla also noted that the employment picture has improved significantly from pre-pandemic levels, providing support for future economic growth. Medalla added that the greater risks emanate from policy spillovers as monetary authorities respond to inflationary pressures with hikes in policy interest rates. The BSP expects inflation to remain elevated over the next few months.
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