Philippine inflation seen to go lower in next months
MANILA, Philippines — As the country posts a slowdown in inflation at the start of the year, analysts at ANZ Research agree with the forecast of the Bangko Sentral ng Pilipinas (BSP) that it would likely glide lower in the next months.
The Philippine Statistics Authority has announced that the Philippines' headline inflation continued to ease from 5.1 percent in December to 4.4 percent in January.
ANZ economists predict that the country's inflation would stay near the BSP's target of 4 percent in the coming months.
They noted that consumer price index rose to 0.2 percent month-on-month in January due to increases in food prices and changes in tax policies following the recent declines in inflation.
"Importantly, at 4.4 percent (year-on-year), the core inflation print suggests that underlying pressures have eased providing support to the BSP's expectation of inflation under 4 percent by Q1 2019," ANZ Research said in a note released Tuesday.
Noting the decline of headline inflation in recent months brought abought by the easing of supply pressures, including food items and lower oil prices, the analysts said the pace of this decline would likely go forward.
"Oil prices have recovered recently and evidence suggests that rice prices may be bottoming out. On a sequential basis, food prices rose 0.4 percent month-on-month in January driven by an increase in fish and vegetable prices," the analysts said.
Looking at the central bank's perspective, ANZ Research sees this latest development in the country's core inflation as "very encouraging."
This suggests that underlying pressures are easing and are consistent with some moderation in domestic demand, they said.
Food and non-alcoholic beverages, alcoholic beverages and tobacco and transport are the main commodity groups that drove the slowdown of the country's inflation in January.
"Among the 11 major commodity groups, the top three contributors to the overall inflation were food and non-alcoholic beverages, housing, water, electricity, gas and other fules, and restaurant and miscellaneous goods and services," the PSA said.
- Latest
- Trending
