The Philippine central bank kept its benchmark interest rate unchanged for a second consecutive meeting as inflation continued to decelerate and pressure on the peso eased.

The Bangko Sentral ng Pilipinas maintained its overnight reverse repurchase rate at 6.25% on Thursday, as seen by all 25 economists in a Bloomberg survey. The decision was in line with earlier signals from Governor Felipe Medalla that the central bank will stick to the current policy rate, after lifting it by 425 basis points since May last year.

Headline inflation, which has cooled four months in a row, is expected to return to the central bank’s 2%-4% goal later this year. The core gauge, which strips out volatile food and fuel costs, has also slowed after hovering at a 24-year high.

The US Federal Reserve’s decision last week to pause interest rate hikes also provided the Philippines’ room to stand pat, with pressure on the peso letting up. The currency is among the better performers against the dollar in Asia this month.

The pause also came amid warnings from economic managers that further monetary tightening — with the key rate at a 16-year high — may dampen economic growth, which already moderated last quarter. President Ferdinand Marcos Jr’s economic team is targeting growth of at least 6% this year amid global risks.

--With assistance from Tomoko Sato, Cecilia Yap and Karl Lester M. Yap.

Author: Andreo Calonzo and Manolo Serapio Jr.