Inflation slowed in May

Inflation likely slowed a bit last May from the previous month but still jumped from a year ago even as food and utility costs eased, the majority of the economists polled by the Inquirer last week said.

“Headline inflation likely fell to 3.1 percent in May from 3.4 percent in April owing to slower increases of food prices, electricity rates, and transport fares relative to year ago,” Deutsche Bank economist Diana Del Rosario said.

The government will release May data on inflation or the rate of increase in prices of basic goods on Tuesday.

To compare, the inflation rate in May last year was 1.6 percent.

As of end-April, inflation averaged 3.2 percent, still within the government’s 2-4 percent target for 2017.

DBS Bank Ltd. economist Gundy Cahyadi also projected 3.1 percent, but cautioned of “upward risks to inflation going forward” mainly from the passage of Duterte administration’s first tax reform package, which will slap new or additional taxes on consumption.

Capital Economics’ forecast was 3.2 percent.

“Consumer price inflation in the Philippines was stable in April—the first time inflation did not increase in six months. We suspect this probably marked the peak and that the rate edged lower in May,” the London-based economic research firm explained in a report.

Metrobank research analyst Pauline May Ann E. Revillas said “our forecast for May inflation is at 3.3 percent amid high petroleum product prices and mixed movements in food prices.”