Private-sector economists are betting that overall inflation in November is approaching the upper band of the government’s target range, or 4 percent, agreeing with or being even more optimistic than the Bangko Sentral ng Pilipinas (BSP).
ING Bank senior economist Nicholas Mapa said in a commentary that stabilizing prices for the all-important staple of rice should help bring headline inflation down to 4.4 percent compared to prices in November 2022, improving from the 4.9 percent recorded in October.
Also, Mapa said declining prices of gasoline and diesel should help inflation edge closer to the central bank’s 2 percent to 4 percent inflation target band.
Further tightening
“This could give the previously hawkish BSP Governor some reason to consider extending his current pause, although his comments from last week suggest that Governor Remolona is open to tightening further should inflation flare up again,” he added.
The forecast from the Netherlands-based group concurs with the BSP’s own forecast. With a latitude of 0.4-percentage points above and below the midpoint of 4.4 percent, the BSP’s forecast ranges from 4 percent to 4.8 percent.
Robert Dan Roces, chief economist at Security Bank Corp., also forecasts 4.4 percent, mainly on high food and electricity prices.
“Our latest estimates show a return of price growth in the heavy-weight food index as well as in electricity costs, plus an upward trend in restaurant and accommodations costs in a demand build-up toward the holidays, offsetting a noticeable decline in pump prices last month,” Roces said. INQ