FINANCE Undersecretary Gil S. Beltran said inflation is expected to ease further in the second half, bringing the 2019 average towards the lower end of the 2.7-3.5% target band for the year.
The 2.7%-3.5% band is the inflation assumption issued by the Development Budget Coordination Committee (DBCC).
“(It will depend) upon oil prices because inflation is also affected by petroleum products but food items will continue to go down because it has happened for the last five or six months. [As for whether it will hit the DBCC assumption] it will be more towards the lower end” Mr. Beltran told reporters during a press briefing late Wednesday.
The Philippine Statistics Authority (PSA) reported that headline inflation in July slowed to 2.4% from 2.7% in June and 5.7% a year earlier, the lowest level in 31 months, or since the 2.2% inflation recorded in December 2016.
The July result matched the 2.4% median estimate in a poll of 17 economists which BusinessWorld conducted a week before the official data came out.
The Bangko Sentral ng Pilipinas (BSP) Monetary Board on Thursday cut its 2019 inflation forecast to 2.6% from already-downward-revised 2.7% which it adopted in its June 20 review, while slashing next year’s forecast to 2.9% from 3% previously.
For the August inflation outlook, Mr. Beltran said the Department of Finance “hopes” it will be lower than the July level. — Beatrice M. Laforga