Philippines inflation matches estimate, gives room for rate cuts

PHILIPPINE inflation quickened in October but within market expectations, giving the central bank room to sustain its easing cycle.

Consumer prices rose 2.3 per cent year on year in October due to faster price gains in food including national staple rice, the statistics agency said on Tuesday (Nov 5). The print matched the median forecast of economists in a Bloomberg survey and was within the central bank’s 2 to 2.8 per cent estimate for the month.

Inflation had decelerated to 1.9 per cent in September, the slowest since May 2020 and below the central bank’s 2 to 4 per cent target range.

The Philippine central bank last month reduced its benchmark interest rate by 25 basis points for the second time this year to 6 per cent as slowing inflation gave it room for further easing. Governor Eli Remolona has said the Bangko Sentral ng Pilipinas is unlikely to resort to half-point cuts unless the nation’s economic growth “turns out to be worse than we thought”. BLOOMBERG