Philippine Consumer Prices Accelerated To 5-Year High In May

Forex News

Philippine annual inflation quickened in May but at a slower pace than expected. The government’s data showed, that the consumer price index rose 4.6% from a year earlier, slightly faster than the April reading of 4.5% and at the lower end of the central bank's forecast of 4.6-5.4%. It marked a 5-year high. That was slower than the median forecast of economists (4.9%). Core inflation, which strips out volatile food and fuel items, was 3.6%.

Nestor Espenilla (Philippine central bank governor) said that the central bank will do what is needed to anchor inflation and ensure it will meet the target in 2019. The bank raised the key interest rate for the first time in four years in May, and the majority of economists predict at least one more increase this year.

Signs of price pressure spreading are becoming more evident with labor groups demanding higher wages and bus operators asking for fare increases. Airlines are also seeking to raise ticket prices.