Inflation Update: Price-rise slows to a near five-year low 

Annual headline inflation continued to surprise in March, clocking in its slowest pace since May 2020.

Now, all eyes are on the Bangko Sentral ng Pilipinas (BSP), as the Monetary Board is set to meet on April 10 – where signs support a quarter-point policy-rate reduction.

Key points

• Headline inflation slowed further to 1.8% in March from 2.1% in the previous month.
• Core inflation, which excludes select volatile food and energy items, also slowed to 2.2% from the preceding month’s 2.4%.
• Pork prices remain the top contributor to headline inflation, despite a slight deceleration. Meanwhile, rice costs declined at an even faster rate in March.

Moving forward

• Metrobank revised its full-year inflation forecast for this year to 3.0%.
• We also maintain the view that the BSP will reduce its policy rate by a cumulative 50-75 basis points this year, depending on price and economic-growth conditions.

(Disclaimer: This is general investment information only and does not constitute an offer or guarantee, with all investment decisions made at your own risk. The bank takes no responsibility for any potential losses.)     

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ECONOMIC UPDATES  

Inflation Update: Price-rise slips to 1.8% in March, green light for BSP’s rate cu

The latest inflation data support views of a policy rate cut in April

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