The Gist
News and Features
Global Philippines Fine Living
Insights
INVESTMENT STRATEGY
Economy Stocks Bonds Currencies
THE BASICS
Investment Tips Explainers Retirement
Webinars
2024 Mid-Year Economi Briefing, economic growth in the Philippines
2024 Mid-Year Economic Briefing: Navigating the Easing Cycle
June 21, 2024
Investing with Love
Investing with Love: A Mother’s Guide to Putting Money to Work
May 15, 2024
retirement-ss-3
Investor Series: An Introduction to Estate Planning
September 1, 2023
View All Webinars
Downloads
Buildings in the Makati Central Business District
Economic Updates
Monthly Recap: BSP to outpace the Fed in rate cuts 
DOWNLOAD
economy-ss-9
Economic Updates
Quarterly Economic Growth Release: 5.4% Q12025
DOWNLOAD
investment-ss-3
Economic Updates
Policy rate views: Uncertainty stalls cuts
DOWNLOAD
View all Reports
Metrobank.com.ph Contact Us
Follow us on our platforms.

How may we help you?

TOP SEARCHES
  • Where to put my investments
  • Reports about the pandemic and economy
  • Metrobank
  • Webinars
  • Economy
TRENDING ARTICLES
  • Investing for Beginners: Following your PATH
  • On government debt thresholds: How much is too much?
  • Philippines Stock Market Outlook for 2022
  • No Relief from Deficit Spending Yet

Login

Access Exclusive Content
Login to Wealth Manager
Visit us at metrobank.com.ph Contact Us
Access Exclusive Content Login to Wealth Manager
Search
The Gist
News and Features
Global Philippines Fine Living
Insights
INVESTMENT STRATEGY
Economy Stocks Bonds Currencies
THE BASICS
Investment Tips Explainers Retirement
Webinars
2024 Mid-Year Economi Briefing, economic growth in the Philippines
2024 Mid-Year Economic Briefing: Navigating the Easing Cycle
June 21, 2024
Investing with Love
Investing with Love: A Mother’s Guide to Putting Money to Work
May 15, 2024
retirement-ss-3
Investor Series: An Introduction to Estate Planning
September 1, 2023
View All Webinars
Downloads
Buildings in the Makati Central Business District
Economic Updates
Monthly Recap: BSP to outpace the Fed in rate cuts 
May 29, 2025 DOWNLOAD
economy-ss-9
Economic Updates
Quarterly Economic Growth Release: 5.4% Q12025
May 8, 2025 DOWNLOAD
investment-ss-3
Economic Updates
Policy rate views: Uncertainty stalls cuts
May 8, 2025 DOWNLOAD
View all Reports
BusinessWorld 3 MIN READ

Inflation on track to fall within target — World Bank

October 4, 2024By BusinessWorld
Related Articles
PH stocks rebound as Fed hints at policy easing December 15, 2023 Stocks decline further on continued profit taking July 3, 2024 Wage hike unlikely to stoke inflation July 14, 2023

Philippine inflation is likely to slow this year and fall within the central bank’s target range, but higher transport charges and domestic rice production pose upside risks, the World Bank said.

In its latest monthly update, the World Bank said that the entry of more rice imports under lower tariffs should help keep inflation within the government’s 2-4% target.

“Inflation resumed its downward trend in August and is on track to fall within target this year,” the Washington-based lender said.

The consumer price index (CPI) eased to 3.3% in August from 4.4% in July. Inflation averaged 3.6% in the first seven months.

The Bangko Sentral ng Pilipinas (BSP) projects inflation to average 3.4% this year.

“The balance of risks to the outlook has shifted toward the downside given expected reductions in rice prices as more imports arrive under the reduced tariff regime,” the World Bank said.

An executive order cutting tariffs on rice to 15% from 35% took effect in July. This helped rice inflation ease to 14.7% in August from 20.9% in July.

However, the World Bank said higher transport and electricity charges, as well as possible global oil and food price shocks still provide upside risks to the inflation outlook.

“Domestic rice production and prices also remain vulnerable with the La Niña weather phenomenon expected to bring more rainfall and intense typhoons in the remaining months of the year,” the World Bank said.

Meanwhile, the World Bank said recent external and domestic developments have given the BSP more space for policy easing.

“Peso appreciation, driven by a wider US interest rate differential, supports domestic disinflation. This gives more room for further normalization of domestic monetary policy,” it said.

The BSP began its easing cycle in August by cutting the target reverse repurchase (RRP) rate by 25 bps to 6.25% from the over 17-year high of 6.5%.

BSP Governor Eli M. Remolona, Jr. earlier said the Monetary Board could implement two more rate cuts at its last two meetings on Oct. 16 and Dec. 19.

The latest policy adjustments will also support faster bank lending, the World Bank said.

“Along with lower inflation, the reductions in the real interest rate, and lower reserve requirements could spur demand for credit in the near term by improving business and consumer sentiment,” World Bank said.

“The BSP estimates the full impact of these policy adjustments will be felt with a lag of 12-15 months.”

This month, the BSP will reduce the RRR for big banks and nonbank financial institutions with quasi-banking functions by 250 bps to 7% from 9.5%.

It will also reduce the ratio for digital banks by 200 bps to 4%, thrift banks by 100 bps to 1%, and rural banks and cooperative banks by 100 bps to 0%.

The World Bank noted the beginning of the US Federal Reserve’s easing cycle also helped increase inflows into the Philippines’ financial markets.

“Aggressive rate cuts by the US Federal Reserve have made assets in emerging economies more attractive to international investors and enhanced capital inflows,” the World Bank said.

The US Federal Reserve cut rates by 50 basis points last month, bringing its key policy rate within 4.75-5%.

Meanwhile, the World Bank said manufacturing sector’s performance will likely remain “modest” amid weak external demand for Philippine exports. — BMDC

This article originally appeared on bworldonline.com

Read More Articles About:
Worldwide News Philippine News Rates & Bonds Equities Economy Investment Tips Fine Living

You are leaving Metrobank Wealth Insights

Please be aware that the external site policies may differ from our website Terms And Conditions and Privacy Policy. The next site will be opened in a new browser window or tab.

Cancel Proceed
Get in Touch

For inquiries, please call our Metrobank Contact Center at (02) 88-700-700 (domestic toll-free 1-800-1888-5775) or send an e-mail to customercare@metrobank.com.ph

Metrobank is regulated by the Bangko Sentral ng Pilipinas
Website: https://www.bsp.gov.ph

Quick Links
The Gist Webinars Wealth Manager Explainers
Markets
Currencies Rates & Bonds Equities Economy
Wealth
Investment Tips Fine Living Retirement
Portfolio Picks
Bonds Stocks
Others
Contact Us Privacy Statement Terms of Use
© 2025 Metrobank. All rights reserved.

Read this content. Log in or sign up.

​If you are an investor with us, log in first to your Metrobank Wealth Manager account. ​

If you are not yet a client, we can help you by clicking the SIGN UP button. ​

Login Sign Up