PSEi faces inflation test at sub-6,000
Philippine stocks might remain under pressure this week as investors brace for the August inflation report, with the benchmark index hovering around the critical 6,000 level after a steep selloff.
F. Yap Securities Inc. said the Philippine Stock Exchange Index (PSEi) would enter the shortened trading week in a “precarious technical condition” as macroeconomic headwinds compound market weakness.
Philstocks Financial Inc. research manager Japhet Tantiangco said chartwise, the local market has given up its position above multiple lines last week. These include its 50-day and 200-day exponential moving averages as well as the 6,150 support and the crucial 6,000 line.
“These are all considered as bearish signs,” Tantiangco said.
F. Yap said investors would closely watch the August inflation report due on Friday, Sept. 4.
A reading above 6 percent would not be surprising and could keep the Bangko Sentral ng Pilipinas’ (BSP) hawkish tilt intact into the fourth quarter.
F. Yap expects August inflation at around 6.2 percent, but warned that risks remain tilted to the upside due to weather-related disruptions affecting food and transport.
The BSP recently trimmed its 2026 average inflation forecast to 6.1 percent from 6.4 percent, while raising its 2027 projection to 5.4 percent from 4.5 percent.
Inflation is expected to move back toward the 3-percent target only in 2028.
The inflation report follows the BSP’s 25-basis-point rate hike last week, which brought the key policy rate to 5 percent.
The brokerage expects the policy rate to stay at 5 percent through yearend, which it sees as at or near the peak of the current tightening cycle.
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