UPDATE 2-Philippine c.bank cuts rates to counter coronavirus blow to economy

* Rate cut is the third so far this year
* Cut brings benchmark interest rate to record low of 2.75%
* C.bank has authority to cut RRR by 200 bps more

(Adds c.bank announcement cancelling May 21 policy meeting,
c.bank governor and analyst comments, updates number of
coronavirus cases and deaths in Philippines)
By Karen Lema and Neil Jerome Morales
MANILA, April 16 (Reuters) - The Philippine central bank cut
its benchmark interest rate by 50 basis points in an off-cycle
move on Thursday, to support an economy in what the bank's
governor has called a once-in-a-lifetime crisis due to the
coronavirus outbreak.
The cut, the year's third such move, took the rate on the
overnight reverse repurchase facility PHCBIR=ECI to a record
low of 2.75%. The central bank cut the policy rate by 25 bps in
February and by 50 bps in March. It has cancelled its May 21
policy meeting.
"Monetary policy works with a lag and it is the sense of the
MB (Monetary Board) that a cut of 125 bps for the first half of
the year is appropriate," Bangko Sentral ng Pilipinas Governor
Benjamin Diokno told reporters.
Diokno has flagged the need for "deeper" rate cuts as the
Philippines, like many countries, grapples with the severe
economic and health effects of the COVID-19 pandemic.
Reported infections crossed 2.05 million and more than
136,600 people have died worldwide, according to a Reuters
tally. The Philippines has reported 5,660 cases, the highest in
Southeast Asia, and 362 deaths. The Philippines, among the first regional nations to take
drastic measures against the virus by ordering quarantine for
half of the population of more than 107 million, is forecast to
post zero growth this year in the government's best case
scenario.
The Philippines "is now facing a once-in-a-lifetime crisis"
calling for "bolder but appropriate moves" by the central bank,
Diokno said on Sunday. The central bank has the authority to slash banks' reserve
requirement ratio (RRR) by 200 bps points more this year. That
will be on top of its cut of 200 bps last month in the ratio to
boost liquidity in the economy.
Curbs for nearly a month on movement and gatherings in and
around the capital, Manila, have dampened domestic consumption,
a key driver of economic growth.
Alex Holmes, economist at Capital Economics, said Thursday's
policy rate cut will not be the last move from the central bank
given that the economic activity in the Philippines is
"collapsing".
He expects the Philippine economy to contract 4% this year
versus last year's 5.9%.
"As such, we think it is only a matter of time before more
easing is announced", Holmes said.