PRIVATE economists supported the Bangko Sentral’s view of a well-behaved inflation in the country in April this year on the back of the tame food and utility prices.
Economists polled by the BusinessMirror showed that the median inflation forecast of private-sector economic experts for April 2015 hit 2.4 percent—within the central bank’s own forecast range of 1.9 percent to 2.8 percent, as earlier announced by BSP Governor Amando M. Tetangco Jr.
This means that the average forecast of economists is an unchanged inflation range from the previous month, as March’s growth of consumer prices also hit 2.4 percent.
The forecasts of the seven economists—based both in the Philippines and overseas—have a range of 2.2 percent to 2.6 percent for the period.
In particular, Standard Chartered economist Jeff Ng has the lowest forecast during the month, at 2.2 percent, due largely to base effects for food inflation.
“Food inflation eased to 4.3 percent year-on-year in March, from a peak of 8.3 percent in August; and we expect it to have eased further in April. However, the fuel-price hikes in April likely increased transport inflation and limited further downside to year-on-year inflation,” Ng said.
Local banks, meanwhile, seem to have agreed that inflation hit 2.4 percent in April.
Economists from Security Bank and Bank of the Philippine Islands (BPI) put their inflation forecast at 2.4 percent, along with Moody’s Analytics.
ING Bank Manila’s Joey Cuyegkeng, meanwhile, forecast inflation to hit 2.5 percent, while Singapore-based DBS Bank economist Gundy Cahyadi and Maybank ATR Kim Eng economist Luz Lorenzo see inflation hitting 2.6 percent.
Emerging worries
WHILE most of the economists attributed their low inflation views to decline in oil and food prices, as well as statistical base effects, some analysts said that inflation might start to tick upward, starting in the second half of the year toward year-end, owing to the possibility of a rebound in oil prices and the waning off of base effects.
“A possible rebound in oil prices toward the second half of the year will probably see inflation inch higher to the midpoint and slightly to the upper end of the inflation target,” BPI economist Nicholas Antonio Mapa told the BusinessMirror.
“I think we are in a bottoming-out process for inflation with the base effects until midyear,” Cuyegkeng said.
Amid the emerging worries, all economists maintain that the average inflation for the year is seen to stay within the 2-percent to 4-percent target range set by the central bank for 2015.
The Philippine Statistics Authority will announce inflation figures on May 5.