Socioeconomic Planning Secretary Arsenio Balisacan said on Thursday that the Bangko Sentral ng Pilipinas' (BSP) policy decisions are also based on domestic economic conditions, not solely on the US Federal Reserve's actions.

Balisacan said this in a Palace briefing as the BSP maintains a hawkish stance on interest rates to combat the country's inflation.

"The BSP considers various factors, and mirroring US Fed cuts wouldn't be a direct response. Our focus remains on managing domestic inflation and ensuring economic growth," Balisacan said.

"The BSP's policy rates are guided by various factors, including inflation, interest rate differentials with the US Fed, and exchange rate movements. While inflation has been a major concern in recent adjustments, we believe the BSP will ease policy rates when inflation numbers show sustained moderation within the target range," Balisacan added.

Balisacan likewise underscored the importance of non-monetary measures in managing inflation alongside the BSP's monetary policy.

The socioeconomic planner also said that the economic managers remain committed to keeping inflation within its target range of 2 to 4 percent amid the rise in food prices in the country.

Balisacan emphasized the government's multi-pronged approach to address rising prices, particularly food costs, which significantly contribute to inflation.

"We are working very hard to address the non-monetary measures that are contributing to the recent rise in inflation," Balisacan said.

He acknowledged inefficiencies in the market system and highlighted the Department of Agriculture's (DA) proposed measures to improve logistics and distribution.

"The DA has proposed a package of measures to the President and the Cabinet. This includes attracting private sector investment in logistics and distribution to narrow the gap between what farmers receive and what consumers pay for food," Balisacan said.

While acknowledging the BSP's hawkish stance due to March's inflation projection at 3.4 to 4.2 percent range, Balisacan emphasized the government's plans to mitigate its impact on growth.

He said that the government is also closely monitoring global food markets, particularly rice prices.

While global food prices have risen, forecasts predict a decline in the second half of 2024 due to the weakening El Niño phenomenon.

This, in turn, should lead to price moderation in the Philippines.