Poll: Inflation likely eased to 1.6% in Nov
Inflation likely eased in November despite a string of late-season storms, as falling rice prices helped keep broader food costs in check—a trend that could bolster the case for another interest rate cut before year’s end.
According to a median estimate from 10 economists polled by the Inquirer last week, the consumer price index may have risen 1.6 percent in November. If that forecast holds, the reading, to be released by the Philippine Statistics Authority on Dec. 5, would come in slightly below October’s 1.7-percent pace.
The consensus sits comfortably within the Bangko Sentral ng Pilipinas’ (BSP) forecast range of 1.1 to 1.9 percent for November. Together, the estimates suggest inflation likely undershot the central bank’s 2 to 4 percent target for a ninth straight month.
“Continued rice price deflation should keep food inflation contained, while a modest increase in electricity tariffs is expected to lift utilities inflation marginally,” economists at ANZ Research said.
Ruben Carlo Asuncion, chief economist at Union Bank of the Philippines, echoed that view. His projection aligned with the consensus, anchored on expectations that cheaper rice—which makes up about 9 percent of the consumer price basket—remained “a powerful dampener on overall inflation.”
“This trend has been well documented and remains a key driver of the low headline reading,” Asuncion said, while noting that the late-season typhoons that cut across parts of the archipelago may have produced mixed price movements for other agricultural goods
Separately, economists from Chinabank Research believed that inflation may have slightly sped up to 1.8 percent last month.
“Upward price pressures came from month-on-month price gains in rice, fruits, vegetables and fish, along with higher electricity rates and fuel prices,” they said, adding that these increases were likely tempered by lower prices of meat, eggs, sugar and cooking gas.
“Consequently, we project inflation to average below the BSP’s target range this year. It is expected to pick up to within the target range next year, largely due to base effects,” they continued.
Overall, subdued inflation could give the BSP room to deliver another rate cut at its policy meeting in December, offering a measure of support to an economy confronting growing pressures at home and abroad.
In October, the Monetary Board trimmed its benchmark rate by 25 basis points to 4.75 percent, an attempt to steady business sentiment rattled by a widening investigation into allegedly irregular flood-control projects. Central bank officials had warned that the scandal could blunt the impact of government spending at a time when public outlays are expected to play a crucial role in supporting growth.
That concern had already seeped into the government’s outlook. Economic managers had conceded that hitting even the lower end of this year’s growth target will be difficult, after the economy expanded just 4 percent in the third quarter—its slowest showing in four years.
BSP Governor Eli Remolona Jr. had said another rate cut in December was “possible,” though he ruled out the kind of aggressive easing that might fuel fears the economy was veering toward a hard landing.
