• April inflation seen little changed

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    Inflation20150504But private analysts’ forecasts range higher at 2.3-2.9% vs BSP’s 1.9-2.8%

    Consumer price growth in April likely stayed little changed from the average rate of 2.4 percent in March, according to a consensus by most private analysts polled by The Manila Times, but the range of all analyst estimates stands higher than that of the central bank.

    Three of the five analysts interviewed gave 2.4 percent as their consensus figure, saying that food, utilities and pump oil prices remained generally steady in April.

    However, two other analysts estimate the rate from 2.3 percent to 2.9 percent, a range higher than the forecast rise of between 1.9 percent and 2.8 percent expected by the Bangko Sentral ng Pilipinas (BSP).

    Official data on April inflation is scheduled for release by the Philippine Statistics Authority (PSA) on May 5. The rate in March ran at 2.4 percent.

    Consensus steady at 2.4%
    Nicholas Antonio Mapa, associate economist at the Bank of the Philippine Islands (BPI), sees inflation in April at around the 2.4 percent rate posted in March.

    “Still, food prices accelerated but at a more moderated pace. We’ll also see [movement in]transport and utilities prices. Overall, [the rate is]still a very depressed inflation print,” he said.

    Mabellene Reynaldo, research analyst at Metrobank Research, estimates April inflation at 2.4 percent, noting that domestic prices that month remained flat month-on-month, with mixed food prices and slow oil inflation keeping the index within the low end of the BSP’s inflation target.

    “Oil prices moved slightly higher m-o-m [month-on-month], albeit still treading at lower levels y-o-y [year-on-year], given supply concerns from the following: militants taking control of an oil terminal in Yemen, smallest weekly increase in US inventory since the start of the year, and from higher demand forecast by the International Energy Agency,” she explained.

    The increase in rice and meat prices has slowed while fruits and vegetables trended higher, but overall, food price movement remained generally slow and stable compared with the past two quarters, dragging down the overall index, she said.

    Patrick Ella, economist at Security Bank, also expects inflation in April at 2.4 percent. He did not cite specific reasons for his forecast.

    From the most to the least optimistic
    An economist at the University of Asia and the Pacific (UA&P) expects the slowdown recorded in March stretching through April, seeing inflation at 2.3 percent last month.

    That estimate already “takes into consideration increases in fuel pump prices and electricity rates” Victor Abola, economist at UA&P, said, giving the most optimistic estimate.

    At the other end of the forecast range, the least optimistic comes from Justino Calaycay Jr., analyst at Accord Capital Equities Corp., who said inflation last month likely inched up to between 2.6 percent and 2.9 percent because of an upside in pump oil prices and a slight kick in utility bills.

    That may put “some pressure on the overall price index, which has managed to keep to the 2.4 percent pace through the first quarter. We think that the pace may have picked up slightly to between 2.6 percent and 2.9 percent in April,” he said.

    BSP sees offsetting in oil, rise prices
    In an earlier announcement, the BSP said April inflation may average between 1.9 percent and 2.8 percent.

    “Price pressures may come from the upward adjustments in local pump prices of oil and power rates. However, the higher energy prices may be offset by the continued decline in rice prices,” BSP Governor Amando Tetangco Jr. said.

    In March, headline inflation slowed to 2.4 percent from 2.5 percent in February, and from 4.1 percent recorded a year earlier.

    Full-year inflation is projected by the central bank at 2.2 percent, down from its previous forecast of 2.3 percent.

    Asia and the Pacific (UA&P) expects the slowdown recorded in March stretching through April, seeing inflation at 2.3 percent last month.

    That estimate already “takes into consideration increases in fuel pump prices and electricity rates” Victor Abola, economist at UA&P, said, giving the most optimistic estimate.

    At the other end of the forecast range, the least optimistic comes from Justino Calaycay Jr., analyst at Accord Capital Equities Corp., who said inflation last month likely inched up to between 2.6 percent and 2.9 percent because of an upside in pump oil prices and a slight kick in utility bills.

    That may put “some pressure on the overall price index, which has managed to keep to the 2.4 percent pace through the first quarter. We think that the pace may have picked up slightly to between 2.6 percent and 2.9 percent in April,” he said.

    BSP sees offsetting in oil, rise prices
    In an earlier announcement, the BSP said April inflation may average between 1.9 percent and 2.8 percent.

    “Price pressures may come from the upward adjustments in local pump prices of oil and power rates. However, the higher energy prices may be offset by the continued decline in rice prices,” BSP Governor Amando Tetangco Jr. said.

    In March, headline inflation slowed to 2.4 percent from 2.5 percent in February, and from 4.1 percent recorded a year earlier.

    Full-year inflation is projected by the central bank at 2.2 percent, down from its previous forecast of 2.3 percent.

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