By BusinessWorld
Headline inflation likely remained steady in June and settled within the central bank’s 2-4% target for a seventh straight month, analysts said.
A BusinessWorld poll of 14 analysts yielded a median estimate of 3.9% for the consumer price index (CPI) in June. This is within the 3.4-4.2% forecast of the Bangko Sentral ng Pilipinas (BSP) for the month.
If realized, June inflation would match the 3.9% in May. It will also be slower than the 5.4% print in the same month a year ago.
The Philippine Statistics Authority (PSA) is set to release June inflation data on Friday (July 5).
“We expect inflation to remain unchanged at 3.9% year on year in June. Soaring prices of rice over the last few months have broadly stabilized, as we’ve passed the peak of the dry spell period,” Sarah Tan, an economist from Moody’s Analytics, said in an e-mail.
The staple grain is one of the significant contributors to the country’s inflation. Rice inflation eased to 23% in May from 23.9% a month earlier, marking the second straight month of slower inflation as global rice prices declined.
“We forecast that inflation remained at 3.9% in June. For the next six months of 2024, however, we believe that inflation could ease to an average of 2.6%. This is primarily because of the impact of the lower tariff on imported rice,” Philippine National Bank economist Alvin Joseph A. Arogo said in an e-mail.
Rice prices are seen to drop further after President Ferdinand R. Marcos, Jr. last month signed Executive Order No. 62, which slashed tariffs on rice imports to 15% from 35% previously.
The month of June also saw lower electricity rates, HSBC economist for ASEAN (Association of Southeast Asian Nations) Aris Dacanay said in an e-mail.
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