"Worst-case scenario is (inflation) above 9%. If that's the
case, clearly we have to do something," Medalla told reporters.
Inflation in January hit a 14-year high of 8.7%, prompting
BSP to say it was likely to raise its benchmark interest rate one more time this year, after having hiked by 50
basis points on Feb. 16.
February's inflation data is due out on March 7, with
analysts set to closely watch the number ahead of the central
bank's next rate-setting meeting on March 23.
"Another month...of upside surprise for inflation could
prod the BSP to hike more aggressively," said Nicholas Mapa,
senior economist at ING.
BSP has raised rates eight times for a total of 400 basis
points since last year,
Medalla said on Friday he still expected inflation to return
to within a target range by the fourth quarter of this year.
(Reporting by Enrico Dela Cruz; Writing by Kanupriya Kapoor;
Editing by Ed Davies)
