Philippine annual inflation slows to near five-year low in March
[MANILA] The Philippines posted its slowest annual inflation rate in nearly five years in March as food and transport prices eased, likely giving the central bank room to cut interest rates at its meeting this month.
The consumer price index rose 1.8 per cent in March, below the previous month’s 2.1 per cent rate and the 2.0 per cent median forecast in a Reuters poll, and was the lowest since May 2020 when the rate hit 1.6 per cent.
“Target consistent inflation and slowing growth momentum should be enough to convince the Bangko Sentral ng Pilipinas to cut rates by 25 basis points next week,” Nicholas Mapa, chief economist at Metropolitan Bank & Trust Co, said on X.
Core inflation, which strips out volatile energy and food prices, also eased to 2.2 per cent in March from 2.4 per cent in February.
The Philippine central bank unexpectedly kept its key interest rate steady in February after three consecutive 25-basis-point cuts in previous reviews, citing uncertainties over global trade policies.
BSP Governor Eli Remolona said last month the central bank remained on an easing cycle and could cut rates at its April 10 meeting. The March reading brought the average inflation rate in the first three months of the year to 2.2 per cent, within the central bank’s 2 to 4 per cent target for the year.
Contributing to the slower inflation in March was the 7.7 per cent decline in rice prices, the steepest since March 2020, and the 1.1 per cent drop in transport costs, the statistics agency said. REUTERS
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