CONSUMER price growth could have cooled further in June as lower energy prices helped ease inflationary pressures, analysts said.
The median forecast in a Manila Times poll was 6.5 percent, lower than the 6.8 percent recorded in May and within the Bangko Sentral ng Pilipinas (BSP) estimate of 6.0-7.0 percent for the month.
If realized, inflation will have slowed for a second straight month but remain above the central bank’s 2.0- to 4.0-percent target.
June data will be released by the Philippine Statistics Authority this Tuesday, July 7.
With the lowest forecast of 6.2 percent, Chinabank chief economist Domini Velasquez said inflation would have slowed as fuel prices declined, supported by the easing tensions in the Middle East.
“Despite El Niño conditions, rice prices also fell month-on-month for a second straight month, likely reflecting relief from last year’s import ban,” she added.
Inflation, however, could remain above target until the first quarter of next year amid “potential impact of El Niño on food prices and a renewed escalation in geopolitical tensions that could push oil prices higher again.”
Meanwhile, Security Bank economist Angelo Taningco said inflation may have hit 6.3 percent due to “disinflationary pressures on fuel, fish, and rice as well as lower meat prices.”
For Pantheon Macroeconomics economist Miguel Chanco, Bank of the Philippine Islands senior economist Emilio Neri and Moody’s Analytics economist Sarah Tan, inflation could have settled at 6.5 percent.
“The likely deceleration should be due largely to a more pronounced deceleration in food prices and as well as a further cooling in transport inflation, with the risks probably tilted to the downside,” Chanco said.
Neri said rice prices likely fell further due to the harvest season and steady imports, helping offset higher transport costs.
However, he still expects “inflationary pressures to remain elevated in the coming months despite June’s likely moderation, with risks still tilted to the upside.”
Tan also said that persistently high electricity rates were likely to keep overall inflation elevated and well above the target range.
“Other upside risks include weather-related disruptions to food supply and volatility in global oil prices,” she said.
“While inflation should continue to moderate over the coming months, we expect it to average 5.4 percent across 2026.”
ANZ Research, meanwhile, said June inflation could be slightly lower at 6.7 percent as global crude oil prices fell by more than 20 percent from end-May levels, easing pressure on domestic fuel prices.
With the highest forecast of 6.9 percent, Union Bank of the Philippines chief economist Ruben Carlo Asuncion, HSBC Research senior economist Aris Dacanay and Emmanuel Lopez of the University of Santo Tomas Graduate School said inflation could have been slightly higher in June.
“This is due to the continued price of the basic commodities, especially food products and rice in interest rates that affect investment and the exchange rate,” Lopez said.
“Added to this is the possibility of increased unemployment because of increased minimum wage, which translates into an increase in production cost,” he added.
Moreover, Asuncion said the “lagged pass-through effects from earlier shocks, including peso weakness and elevated import costs, continued to support price pressures across goods and services.”
“Inflation expectations have risen, reflecting more cautious household sentiment, which may further delay the normalization of core inflation,” Asuncion added.
Dacanay, for his part, said that food prices were sticky in June with poultry and vegetables up despite the drop for fuel.
“We expect inflation to accelerate further in the second half of the year as the energy shock feeds through into food prices,” he said.
“The lagged impact of fertilizer prices on food supply will likely come into the picture in the next few months, aggravating the potential damages the El Niño season may have on global food supply,” he added.
