Most central banks unlikely to follow the Philippines

Indonesia and the Philippines are likely to tighten monetary policy aggressively over the rest of this year. The Philippines may even call an emergency policy meeting in the face of soaring inflation. But these two countries are the exceptions. With the recent uptick in inflation in Emerging Asia set to fade over the coming quarters, price pressures are unlikely to become a big headache for most of the region’s central banks – one reason we don’t expect much, if any, further tightening in most other countries.