Logo of Phnom Penh Post newspaper Phnom Penh Post - Philippine inflation likely sizzled above BSP target in April

Philippine inflation likely sizzled above BSP target in April

Content image - Phnom Penh Post
The Bangko Sentral ng Pilipinas’ (BSP). PHILIPPINE DAILY INQUIRER

Philippine inflation likely sizzled above BSP target in April

Inflation in the Philippines likely sizzled and jumped above the upper end of central bank Bangko Sentral ng Pilipinas’ (BSP) two-to-four per cent target range of manageable price hikes last month.

All 22 April inflation forecasts collected by Philippine Daily Inquirer last week were above the four per cent posted in March. The Philippine Statistics Authority’s (PSA) consumer price index (CPI) report for last month will be out on May 5.

In Philippine Daily Inquirer’s poll, China Bank’s Domini Velasquez, Goldman Sachs Economics Research, and ING’s Nicholas Antonio Mapa had the highest headline inflation forecast of 4.8 per cent year-on-year for April.

Mapa attributed his estimate to “upward pressure delivered by surging transport costs and expensive utilities”, adding that “food inflation may trend higher as well, especially for cereal items”. The Ukraine conflict jacked up global commodity prices, especially of food and oil, and the World Bank last week warned that elevated prices may extend up to 2024.

“Second round effects may also be creeping in as higher transport costs feed through to the rest of the CPI basket,” Mapa added.

High inflation, coupled with a possibly “robust” first-quarter gross domestic product (GDP) performance “could be enough to convince BSP governor Benjamin Diokno to push forward with his rate hike by May or more likely by June”, Mapa said. The next BSP meeting on the monetary policy stance on May 19 will happen a week after the government’s first-quarter GDP report on May 12.

Bank of the Philippine Islands’ Emilio Neri Jr, BDO Unibank’s Jonathan Ravelas, Security Bank’s Robert Dan Roces, as well as University of the Philippines-Los Banos’ (UPLB) Agham Cuevas projected 4.7 per cent. “Inflation remains mostly cost-push driven, and now fully reflects the effects of the Ukraine conflict on prices. We expect inflation to peak this quarter and ease above the four per cent level for the rest of the year,” Roces said.

Barclays’ Shreya Sodhani, Capital Economics’ Gareth Leather, HSBC Global Research, Pantheon Macroeconomics’ Miguel Chanco, Philippine National Bank’s Alvin Joseph Arogo, Regina Capital’s Luis Gerardo Limlingan, and Rizal Commercial Banking Corp’s Michael Ricafort forecast a 4.6 per cent inflation rate last month. “Typhoon ‘Agaton’ likely added to the inflation pressure as well,” Arogo noted.

For ANZ’s Sanjay Mathur, Oxford Economics’ Makoto Tsuchiya and Sian Fenner, Sun Life Financial’s Patrick Ella, United Overseas Bank’s Loke Siew Ting, and University of Asia and the Pacific’s Victor Abola, the rate of increase in prices of basic commodities on April hit 4.5 per cent year-on-year.

“We think the inflationary pressure will linger given our forecast of higher-for-longer global commodity prices, which will feed into domestic prices as the Philippines is a net commodity importer,” Oxford Economics’ economists said.

Citi’s Nalin Chutchotitham projected 4.4 per cent, while the lowest forecast of 4.3 per cent was shared by Moody’s Analytics’ Steven Cochrane and UnionBank of the Philippines’ Ruben Carlo Asuncion, as the latter also pointed to the direct effects of a weaker peso on inflation.

PHILIPPINE DAILY INQUIRER/ASIA NEWS NETWORK

MOST VIEWED

  • ‘Education’ a priority traffic-law penalty

    A top National Police official on June 21 neither rejected nor confirmed the authenticity of a leaked audio message, which has gone viral on social media, on a waiver of fines for a number of road traffic-related offences. General Him Yan, deputy National Police chief in

  • Pursat Ford assembly plant opens

    The Kingdom’s first Ford assembly plant was inaugurated on June 16 in Pursat province amid rising demand for brand-new vehicles among Cambodians. The facility is seen as a game changer for the domestic automobile industry, which could bring a wave of investors seeking to cash

  • Siem Reap’s $18M zoo said to educate public, help wildlife

    Angkor Wildlife and Aquarium Co Ltd has invested $18 million in a zoo in Siem Reap province, which will be opened in October to educate and promote animal conservation as well as attract national and international tourists. Currently, the Angkor Wildlife and Aquarium is building the

  • Volunteer scheme to foster ‘virtuous’ humanitarian spirit

    A senior education official said volunteer work contributes to solidarity and promotes a virtuous humanitarian spirit among the youth and communities. Serei Chumneas, undersecretary of state at the Ministry of Education, Youth and Sport, made the comment during the opening of a training programme called “

  • $50B infrastructure plan en route

    The government’s upcoming $50 billion,10-year infrastructure master plan will provide tremendous investment opportunities for domestic and foreign entities, transport experts and economists say. Minister of Public Works and Transport Sun Chanthol revealed the plan to Japanese ambassador to Cambodia Masahiro Mikami on June 15. At

  • Chinese firms unveil preliminary results on metro, monorail for capital

    Minister of Public Works and Transport Sun Chanthol and representatives from China Road and Bridge Corp (CRBC) and its parent company, the state-owned China Communications Construction Co Ltd (CCCC), met on June 24 for talks on results of the firms’ preliminary study on a potential metro