Philippine inflation at lowest since 2019, backs more rate cuts

[MANILA] Philippine inflation slowed to the lowest in more than five years in April, backed by a sustained decline in rice prices and allowing the central bank to stick with its plans for further monetary easing this year.

Consumer prices increased 1.4 per cent last month from a year earlier, the Philippine Statistics Authority (PSA) said on Tuesday (May 6). That was the slowest inflation since November 2019, based on PSA data and followed the 1.8 per cent rate in March and was below the 1.8 per cent median estimate in a Bloomberg News survey.

The latest number would help the central bank – which had forecast inflation to come in within a range of 1.3 per cent and 2.1 per cent – to continue cutting its key interest rate for the rest of the year.

The Bangko Sentral ng Pilipinas (BSP) lowered its benchmark rate last month and signalled further policy easing ahead as the risks of a global slowdown due to higher US tariffs confront the South-east Asian nation.

BSP governor Eli Remolona last month said that while he sees more rate cuts this year, he does not expect it to happen at every policy meeting. The central bank’s Monetary Board will meet next on Jun 19. BLOOMBERG