English
Philippines: Private economists slash inflation forecasts further
MANILA, Philippines — Economists of private banks lowered anew their inflation forecasts for this year and next year due to stable global oil prices and lower electricity rates, base effects, easing domestic rice and other food prices, as well as weaker global economic prospects.
The latest survey of private economists conducted by the Bangko Sentral ng Pilipinas (BSP) from Sept. 5 to 16 showed that inflation is expected to settle at 2.7 percent this year and 3.1 percent for next year.
Economists retained their inflation for 2021 at 3.1 percent.
Dennis Lapid, director of the central bank’s Department of Economic Research, said analysts and economists expect inflation to remain manageable and within the BSP’s target of two to four percent.
Lapid said additional downside risks to inflation are seen to emanate from the continued implementation of non-monetary policy actions such as Republic Act 11203 or the rice tariffication law to increase domestic food supply and stabilize prices.
On the other hand, he said possible upside risks to inflation are the adverse effects of weather conditions on domestic food supply, expectations of elevated pork prices due to the African swine fever (ASF) and increased demand for other meat products such as chicken, and potential rebound in global oil prices.
According to Lapid, other factors that could push inflation higher include the weaker peso, higher domestic demand during the holiday season, the proposed adjustments in excise taxes on oil, tobacco, and alcoholic beverages as well as geopolitical tensions.
Korea Exchange Bank has the highest inflation forecast for 2019 with 3.1 percent followed by Al-Amanah Islamic Bank and BDO with three percent, Bank of China with 2.9 percent, ING with 2.8 percent as well as Bangkok Bank and Mizuho Bank with 2.7 percent.
For 2020, Standard Chartered Bank has the highest inflation forecast at 4.2 percent followed by UBS with 3.4 percent, Security Bank with 3.3 percent, Ayala-led Bank of the Philippine Islands, Land Bank of the Philippines and Robinsons Bank with 3.2 percent as well as Rizal Commercial Banking Corp. (RCBC) with a range of three to 3.2 percent.
Source: https://www.philstar.com/business/2019/10/28/1963882/private-economists-slash-inflation-forecasts-further#6aSSX7ezeyTZvlmz.99