The Philippines’ central bank (BSP) kept its overnight rate on hold at 4.5% today, however, it did still tighten monetary policy by raising the reserve requirement ratio. Although inflation is above the central bank’s 3-5% target, downside risks to growth are rising amid increasing concern over the economic outlook in the euro-zone and the US. As a result, we now believe that policy tightening will proceed at a slower pace than previously forecast.