economics – Page 28 – Author Carlo Carrasco

Further rate cuts by BSP could boost demand for condominium units and new residential projects in Metro Manila

October 18, 2024October 10, 2024carlocarrasco

Here in Metro Manila, there is currently an oversupply of condominium units. Further rate cuts by the Bangko Sentral ng Pilipinas (BSP) could boost demand for existing condominium units and also new residential projects within the metropolis, according to a BusinessWorld news report.

To put things in perspective, posted below is an excerpt from the BusinessWorld report. Some parts in boldface…

FURTHER RATE CUTS by the Philippine central bank could help spur new residential project launches and drive take-up of existing condominiums in Metro Manila, a property consultant said.

In its third-quarter property market report, Leechiu Property Consultants (LPC) said the inventory level of condominium units in Metro Manila has reached 67,600 units across 510 buildings — “the highest since the pandemic.”

“It’s an oversupply of the buildings in the market at 29 months’ supply. (Developers) have been slowly launching new projects,” LPC Research Director Roy Amado Golez said at a briefing on Oct. 8.

Quezon City and Ortigas (plus fringe areas) have the most number of unsold condominium units at 18,000 and 13,500, respectively.

High interest rates may have dampened demand for residential condominiums in Metro Manila. LPC said 6,885 units were sold in the July-to-September period, “close to the 7,000 level for the third straight quarter.”

The Bangko Sentral ng Pilipinas (BSP) had kept its policy rate at an over 17-year high of 6.5% from October 2023 to mid-August 2024. It reduced the benchmark rate to 6.25% at its Aug. 15 meeting.

“The interest rate levels today are still at elevated levels, at 6.25%. However, we’ll be likely seeing rate cuts in October as well as December. Hopefully, those rate cuts will boost… the residential market,” Mr. Golez said.

BSP Governor Eli M. Remolona, Jr. earlier signaled the Monetary Board could deliver two 25-basis-point (bp) rate cuts at each of its two remaining meetings this year.

LPC said rate cuts would help ease lending conditions for both developers and homebuyers, as well as encourage developers to launch new projects.

Muted demand may have prompted developers to defer new residential projects. New project launches plunged by 39% to 2,145 units in the quarter ending September, which LPC said was the lowest since the pandemic.

“What developers are most likely doing now is reselling or re-launching or reintroducing marketing programs for their current inventory,” Mr. Golez said, adding that lower interest rates may provide a lift to sales in the next few quarters.

Let me end this post by asking you readers: What is your reaction to this recent development? Do you think the BSP should reduce the rates soon so that the residential market of Metro Manila will be reinvigorated? Are there any families in your local community who intend to buy a condominium unit and live in it?

You may answer in the comments below. If you prefer to answer privately, you may do so by sending me a direct message online.

+++++

Thank you for reading. If you find this article engaging, please click the like button below, share this article to others and also please consider making a donation to support my publishing. If you are looking for a copywriter to create content for your special project or business, check out my services and my portfolio. Feel free to contact me with a private message. Also please feel free to visit my Facebook page Author Carlo Carrasco and follow me on Twitter at @HavenorFantasy as well as on Tumblr at https://carlocarrasco.tumblr.com/ and on Instagram athttps://www.instagram.com/authorcarlocarrasco

For more South Metro Manila community news and developments, come back here soon. Also say NO to fake news, NO to irresponsible journalism, NO to misinformation, NO to plagiarists, NO to reckless publishers and NO to sinister propaganda when it comes to news and developments. For South Metro Manila community developments, member engagement, commerce and other relevant updates, join the growing South Metro Manila Facebook group at https://www.facebook.com/groups/342183059992673

Over P1 billion deposited through BSP’s coin machines

October 18, 2024October 17, 2024carlocarrasco

A major breakthrough has been realized with regards to recirculating massive amounts of loose change in the Philippines as more than P1 billion in coins have officially been deposited into the coin deposit machines (CoDMs) of the Bangko Sentral ng Pilipinas, according to a GMA Network news report.

To put things in perspective, posted below is an excerpt from the GMA news report. Some parts in boldface…

Over a year since the launch of coin deposit machines (CoDMs), the monetary value of coins deposited through the Bangko Sentral ng Pilipinas’ (BSP) initiative to promote coin circulation has breached P1 billion.

In a statement on Thursday, the BSP said the total value of coins which coursed through CoDMs has reached P1,008,889,490.24.

The CoDMs, introduced in June 2023, were launched in a bid to encourage the public to make use of their idle coins.

The BSP said that since its launch, the CoDMs have accumulated more than 260,000,000 pieces of coins and facilitated almost 240,000 transactions.

Through CoDMs, people can place legal tender coins in the machines, with the total value credited to e-wallet accounts in GCash or Maya, GoTyme bank accounts, or converted into shopping vouchers.

As of this writing, the BSP’s coin deposit project website has yet to have the latest numbers published. Previously, the official numbers were P950,361,380.76 in overall value, 250,352,704 coins counted and 228,482 transactions registered as of September 15, 2024. You can read my September 26, 2024 post by clicking here.

Let me end this piece by asking you readers: What is your reaction to this recent development? Have you deposited your loose change into a BSP coin deposit machine in your locality during the past sixty days?

You may answer in the comments below. If you prefer to answer privately, you may do so by sending me a direct message online.

+++++

For more South Metro Manila community news and developments, come back here soon. Also say NO to fake news, NO to irresponsible journalism, NO to misinformation, NO to plagiarists, NO to reckless publishers and NO to sinister propaganda when it comes to news and developments. For South Metro Manila community developments, member engagements, commerce and other relevant updates, join the growing South Metro Manila Facebook group at https://www.facebook.com/groups/342183059992673

US Dollar reserves of the Philippines reach all-time high of almost $112 billion

October 15, 2024October 8, 2024carlocarrasco

Based on the preliminary data of the Bangko Sentral ng Pilipinas (BSP), the American Dollar reserves of the Philippines reached $111.981 billion (as of September 2024 specifically) which counts as a new all-time high, according to a Manila Bulletin business news report.

To put things in perspective, posted below is an excerpt from Manila Bulletin report. Some parts in boldface…

The country’s US dollar stock climbed to its highest level of $111.981 billion as of end-September 2024, surpassing the previous record of $108.794 billion in 2021, as the central bank was accumulating foreign exchange and assets to boost external reserves and defend the local currency.

Based on preliminary data released by the Bangko Sentral ng Pilipinas (BSP) on Monday, Oct. 7, the gross international reserves (GIR) increased by 14.13 percent or by $13.865 billion year-on-year compared to $98.116 billion same time in 2023.

The GIR also rose by 3.82 percent or by $4.125 billion versus end-August this year’s reserves of $107.857 billion.

The BSP-monitored GIR are foreign assets of the BSP invested in foreign-issued securities, monetary gold, and foreign exchange.

The latest GIR level is “more than adequate external liquidity buffer” that is equivalent to 8.1 months’ worth of imports of goods and payments of services and primary income. It is also about 6.3 times the country’s short-term external debt based on original maturity and 4.4 times based on residual maturity, said the BSP.

Basically, a GIR is adequate if it can finance at least three-months’ worth of the country’s imports of goods and payments of services and primary income. This was based on international standards. The GIR is also viewed as more than sufficient if it provides at least 100 percent cover for the payment of the country’s foreign liabilities, public and private, falling due within the immediate 12-month period.

The reserves were higher in end-September because of the government’s net foreign currency deposits with the BSP that includes proceeds from the issuance of ROP Global Bonds.

The GIR likewise got a boost from the BSP’s gold holdings which had a higher value with the increase in the prices of gold in the global market. The BSP’s net income also increased due to its investments overseas.

Let me end this post by asking you readers: What is your reaction to this recent development? What is the first thing that comes to your mind when the Philippines’ US Dollar reserves grow? Does this development make you feel comfortable when it comes to banking, investing or running a local business? Are you satisfied with the way the BSP has been moving with regards to financial and economy activities?

You may answer in the comments below. If you prefer to answer privately, you may do so by sending me a direct message online.

+++++

AMRO sees Philippine economy growing 6.1% to 6.3% in 2025

October 15, 2024October 4, 2024carlocarrasco

In its recent update, the ASEAN+3 Macroeconomic Research Office (AMRO) sees the economy of the Philippines achieving growth of 6.1% to 6.3% in 2025, according to a BusinessWorld news report.

To put things in perspective, posted below is an excerpt from the BusinessWorld report. Some parts in boldface…

THE PHILIPPINES will likely post the second-fastest growth in the Association of Southeast Asian Nations Plus 3 (ASEAN+3) region this year and in 2025, driven by faster government spending and easing interest rates, according to a regional think tank.

In its October update, the ASEAN+3 Macroeconomic Research Office (AMRO) retained its gross domestic product (GDP) growth forecast for the Philippines at 6.1% this year and 6.3% next year.

“We didn’t change the forecast for the Philippines. As you can see, we expect growth to be at 6.1%, which will be an improvement from last year’s 5.6%,” AMRO Chief Economist Hoe Ee Khor told a virtual briefing on Thursday.

“This is mainly because we expect government investment spending to be higher this year, together with services exports,” he said.

The AMRO’s projection is within the government’s 6-7% target for 2024. However, its 2025 forecast is below the government’s 6.5-7.5% goal.

Mr. Khor said Philippine economic growth remains one of the strongest in the ASEAN+3 region, which includes members of the ASEAN, China, Hong Kong, Japan and South Korea.

AMRO’s growth forecast for the Philippines is just behind Vietnam (6.2%), and ahead of Cambodia (5.6%), Indonesia (5.1%), China (5%), Malaysia (4.7%), Laos (4.5%), Brunei Darussalam (4%), Hong Kong (3.3%), Thailand (2.8%), South Korea (2.5%), Singapore (2.4%), Myanmar (1.8%) and Japan (0.5%).

Philippine growth is also projected to be above the projected ASEAN+3 average of 4.2% this year. This was slightly lower than the previous forecast of 4.4%.

“Growth for the region will be driven by continued recovery in external trade, resilient domestic demand, and a boost in tourism due to relaxed visa policies in some economies,” AMRO said.

For 2025, the ASEAN+3 region’s growth forecast was upgraded to 4.4% from 4.3% previously, in line with expectations of steady global growth.

“The region is on track to achieve steady growth this year and the next and this will be underpinned by resilient domestic demand and the ongoing recovery in exports,” AMRO Principal Economist Allen Ng told the briefing.

Let me end this post by asking you readers: What is your reaction to this recent development? Do you think inflation the Philippine economy has enough momentum to grow better in 2025 than what AMRO predicted?

You may answer in the comments below. If you prefer to answer privately, you may do so by sending me a direct message online.

+++++

At least 4 more airports expected to be privatized in 2025

October 14, 2024October 9, 2024carlocarrasco

Recently the Department of Transportation (DOTr) announced that at least four more airports are expected to be privatized in 2025, according to a BusinessWorld news report. Clearly the recent privatization of the Ninoy Aquino International Airport (NAIA) sparked a wave of change with regards to air travel and the need to modernize airports.

To put things in perspective, posted below is an excerpt from BusinessWorld report. Some parts in boldface…

AT LEAST four more Philippine airports in the countryside are expected to be privatized in 2025, the Department of Transportation (DoTr) said last week.

“For next year, we have Iloilo, Puerto Princesa and Kalibo [airports],” Transportation Undersecretary Roberto C.O. Lim told reporters on the sidelines of an aviation forum. “We have ongoing negotiations with the proponents.”

The agency also expects to launch the competitive tender for the Davao International Airport under a public-private partnership (PPP) program.

Villar-led Prime Asset Ventures, Inc. holds the original proponent status for both P14.7-billion Iloilo International Airport and P10.24-billion Puerto Princesa International Airport, according to the Public-Private Partnership (PPP) Center website.

Meanwhile, Mega7 Construction Corp. has submitted an unsolicited proposal to operate, upgrade and maintain the P3.62-billion Kalibo International Airport.

Mr. Lim said the government expects to award the contract for the operations and maintenance of New Bohol-Panglao International Airport this year. The contract is undergoing a Swiss challenge, which allows other companies to submit alternative proposals that the original proponent can match.

In September, the infrastructure arm of the Aboitiz Group got the contract for the operations and maintenance of the P12.75-billion Laguindingan International Airport in Northern Mindanao.

Aboitiz InfraCapital, Inc. is expected to sign the contract this month, the Transportation department said, adding that the new private operator would take over operations by next year.

The same company also holds the original proponent status for the operations and maintenance of the P4.5-billion Bohol airport.

Let me end this post by asking you readers: What is your reaction to this recent development? Do you approve of having more airports nationwide to get privatized? Do you have any concerns about the private entities mentioned in the report that want to privatize the other airports?

You may answer in the comments below. If you prefer to answer privately, you may do so by sending me a direct message online.

+++++

Due to failure to fulfill energy commitments, Solar Philippines’ 21 contracts with government will be terminated

October 13, 2024October 12, 2024carlocarrasco

Have you ever heard of a corporation called Solar Philippines? That company boasted being the largest solar company in Southeast Asia and the national government awarded them with lots of contracts years ago. The results, however, are disastrous as Solar Philippines failed to fulfill the energy commitments which compelled the government to initiate moves to discontinue 21 of the 42 contracts, according to a GMA Network news report.

To put things in perspective, posted below is an excerpt from the GMA News report. Some parts in boldface…

The Department of Energy (DOE) on Thursday said it is set to discontinue 21 or half of the 42 service contracts it awarded to Solar Philippines following the company’s alleged failure to carry out its energy commitments.

The DOE made the announcement at the Senate finance subcommittee hearing on the agency’s budget after Senate President Pro Tempore Jinggoy Estrada inquired about the matter.

“Twenty-one of the contracts are already being processed for termination because they are not able to deliver the scheduled targets of the work program,” Energy Undersecretary Rowena Cristina Guevara said at the hearing.

Estrada said different renewable energy companies were awarded a total of 473 service contracts for the construction of solar farms as of last March, supposedly for 32,359 megawatts of renewable energy supply.

He said that only 174.41 megawatts or 2% had been completed and started commercial operations of the 10,000 megawatts committed by Solar Philippines and its affiliates.

“The vast majority of the total commitment have not yet entered the development stage and remain in various phases of pre-development. How will this affect the department’s targets?” the senator asked.

He was referring to the Iba-Palawig project, Iba-Palawig 2 project, and San Marcelino phase 3 project.

Guevara said that acquisition of land, either through lease or purchase, is the most challenging part of energy companies in constructing power facilities.

“Previously, possessory rights were not required when we issued service contracts. However, under the new guidelines, developers must have possessory rights before service contracts are granted,” she said.

Estrada, however, inquired specifically as to why Solar Philippines, owned by businessman Leandro Leviste, was taking too long to adhere with the terms of its service contracts compared with other developers.

“You know, my conclusion is that while other project developers take an average of around two to three years to develop solar power projects, Solar Philippines and its affiliates have taken more than three years to even take its projects to development phase and much longer for actual construction,” the senator said.

“Bakit masyadong pinagkakatiwalaan itong Solar Philippines? (Why put so much trust with Solar Philippines?) Why do you keep on awarding contracts to them?” he added.

Guevara said 22,000 megawatts of capacity were already fully developed or are in development of 32,359 megawatts covered by service contracts.

“The remaining 10,000 megawatts depend on Solar Philippines, which could significantly compromise the DOE’s ability to meet its commitment to transitioning to renewable energy. I hope you seriously consider this matter,” Estrada said.

Senators Pia Cayetano and Sherwin Gatchalian also inquired about delays in the commitments indicated in the service contracts.

According to Guevara, the DOE would issue new sets of terms of reference for its succeeding green energy auctions, to include the performance of renewable energy companies as qualifying conditions.

In my honest opinion in relation to this development, renewable energy sources like solar and wind are truly unreliable. On the part of Solar Philippines (founded in 2013), generating 174.41 megawatts instead of the required 10,000 megawatts over the years is shocking. That being said, initiating moves to discontinue the 21 contracts with Solar Philippines makes a lot of sense.

Again, in my own view, the government should stop focusing so much on renewable energy and focus more on nuclear power to ensure clean and abundant energy for the entire nation as the energy needs of the people and businesses will only keep on growing. Solar power cannot be relied on as the sun does not shine brightly 365 days per year nor can the power collected through solar panels be enough to meet the needs to the nation.

Let me end this post by asking you readers: What is your reaction to this recent development? Do you think it is right for the government to move to terminate the 21 contracts with Solar Philippines? Are you convinced that solar power is not the solution for the nation’s energy requirements? What excuse can Solar Philippines come up with to convince the government to retain the 21 contracts?

You may answer in the comments below. If you prefer to answer privately, you may do so by sending me a direct message online.

+++++

IMF sees Philippine economy growing by more than 6% in 2025

October 11, 2024October 3, 2024carlocarrasco

Citing key factors in its research, the International Monetary Fund (IMF) predicts that the economy of the Philippines will expand by more than 6% in 2025, according to a Philippine News Agency (PNA) news article.

To put things in perspective, posted below is an excerpt from the PNA news article. Some parts in boldface…

The Philippine economy successfully navigated multiple external headwinds in recent years and is expected to grow by over 6 percent next year, an International Monetary Fund (IMF) official said.

In a briefing at the Bangko Sentral ng Pilipinas office in Manila on Wednesday, IMF Mission Chief Eli Arbatli Saxegaard said the Philippines remained among the best performing economies in the region.

An IMF team led by Saxegaard held meetings in Manila from Sept. 18 to Oct. 2 to conduct discussions on the Philippine economy for the 2024 Article IV Consultation.

Saxegaard said the Philippine economy is projected to grow by 5.8 percent this year and will further accelerate to 6.1 percent in 2025.

“This pick-up in growth will be supported by more accommodative financial conditions and higher investment,” she said.

The latest projection, however, was lower than the 6 percent and 6.2 percent previous forecast for 2024 and 2025.

“The downward revision from our July forecast reflects our view that private consumption is going to grow slightly with less momentum. So I would like to highlight that the downgrade is very small, 0.2, and reflects the fact that the first half (of the year) private consumption growth was lower than what we had anticipated. And this might be in part driven by the high food prices,” Saxegaard said.

Despite the revision, Saxegaard said the Philippines continues to be one of the highest growing economies in the region.

“I would also like to highlight that the growth forecast for the Philippines remains one of the highest in the region. It’s 6.1 percent growth for 2025, is a very respectable growth rate… So it’s a very small adjustment reflecting the outturns the first half,” she said.

Downside risks to the country’s growth outlook include a slowdown in major economies that could disrupt trade and financial flows; commodity price volatility and supply shocks; and an escalation of geopolitical tensions or regional conflicts.

Easing of global financial conditions, or faster than anticipated private investment linked to public-private-partnerships and larger foreign direct investment inflows, on the other hand, could stimulate higher growth.

The IMF believes that the Philippine economy holds significant potential with its abundant natural resources, untapped blue economy, and a sizable demographic dividend.

Saxegaard, however, said that unlocking the medium-term growth potential will depend on structural reforms and strengthened social protection programs.

She said priority areas include upgrading infrastructure, making significant investments in healthcare and education, addressing land fragmentation and low productivity in agricultural sector, and enhancing governance.

Inflation, meanwhile, is projected to settle within the government’s target for both 2024 and 2025.

“We believe that the decisive monetary tightening and other measures have helped mitigate inflationary pressures in the Philippines, recent tariff cuts on imported rice and other non-monetary measures helped reduce food prices, and should further reduce headline inflation by the year end,” Saxegaard said.

“For this year, our expectation is that for inflation to average 3.3 percent, and for next year, 3 percent. That would be supported by lower food and core inflation remaining well within the target.”

Let me end this post by asking you readers: What is your reaction to this recent development? Do you think the economy of the Philippines still has momentum to grow better in 2025 than what the IMF predicted?

You may answer in the comments below. If you prefer to answer privately, you may do so by sending me a direct message online.

+++++

President Marcos signs into law VAT on foreign digital services

October 10, 2024October 2, 2024carlocarrasco

Foreign entities that provide digital services to their customers here in the Philippines will have to pay their fair share of taxes as President Ferdinand “Bongbong” Marcos, Jr., recently signed into law Republic Act Number 12023 (RA12023) which imposes the 12% value-added tax (VAT) on foreign digital service providers (DSPs), according to a Philippine News Agency (PNA) news article.

To put things in perspective, posted below is an excerpt from the PNA news article. Some parts in boldface…

President Ferdinand R. Marcos Jr. signed into law on Wednesday a measure imposing a value-added tax (VAT) on foreign digital services providers (DSPs).

A priority measure of the administration, Republic Act (RA) 12023 imposes a 12 percent VAT on foreign DSPs, such as Netflix, Disney, and HBO, to generate additional revenue for the government.

In his message, Marcos said the new law would level the playing field for local providers.

“If you are reaping the rewards of a fruitful digital economy here, it is only right that you contribute also to its growth. After all, whether you are a small tech startup or a global tech giant based halfway around the world, if you are making money here in the Philippines, you’re a part of our community, and with that comes a shared responsibility,” Marcos said.

According to the President, about PHP105 billion in revenue is expected to be collected in the next five years due to RA 12023.

The amount is enough to build 42,000 classrooms, more than 6,000 rural health units, and 7,000 km of farm-to-market roads, the Chief Executive noted.

Additionally, 5 percent of the revenues generated by the law will be allocated to the local creative industry.

“This means our artists, filmmakers, musicians, the very people who fill our platforms with storage and the content, will directly benefit. It ensures that our creative talents are not just surviving in a competitive digital market, but will be allowed by fairness and progress,” Marcos said.

The President thanked the legislators for passing the measure even as he called on companies covered by the law to support and heed the rules of the Act.

‘Fair and square’ tax policies – Senator Sherwin Gatchalian, meanwhile, said the new law is expected to address revenue losses by clarifying the taxability of non-resident digital service providers and addressing the ambiguity in the previous law.

“We believe in the importance of creating an environment where our digital services providers, whether they are nonresident or local, operate under fair and square tax policies,” Gatchalian said in a statement. He said the new measure does not mean a new tax imposition.

Let me end this post by asking you readers: What is your reaction to this recent development? Do you think the new law will be good for the economy of the Philippines? Do you think that the foreign digital service providers will somehow raise the subscription rates and fees for their customers here in the Philippines in response to the new law?

You may answer in the comments below. If you prefer to answer privately, you may do so by sending me a direct message online.

+++++

Philippines inflation down to 1.9% this past September, lowest since May 2020

October 7, 2024October 4, 2024carlocarrasco

The inflation rate of the Philippines fell down to 1.9% for the month of September 2024 which marks a 4-year-low, according to a Philippine News Agency (PNA) news article.

To put things in perspective, posted below is an excerpt from the PNA news article. Some parts in boldface…

The country’s headline inflation further eased to 1.9 percent in September this year, the lowest recorded since the 1.6 percent in May 2020.

Headline inflation was at 3.3 percent in August and 6.1 percent in September last year.

In a briefing on Friday, National Statistician Dennis Mapa said the latest data brought the year-to-date inflation to 3.4 percent, which is well within the government’s 2 to 4 percent target.

Mapa said the downtrend in the overall inflation was due to the slower annual increase in food and non-alcoholic beverages at 1.4 percent from 3.9 percent in August.

Food inflation, in particular, eased to 1.4 percent in September from 4.2 percent the previous month.

Mapa said the deceleration in food inflation was due to the slower inflation rate of rice at 5.7 percent from 14.7 percent in August.

Other contributors to the lower food inflation include the faster decline in the inflation of vegetables, tubers, cooking bananas, and pulses.

Lower inflation rates were also reported for corn, flour, bread and other bakery products, meat and other parts of slaughtered land animals, and ready-made food and other food products.

In a separate statement, the National Economic and Development Authority (NEDA) assured the public that the government remains committed to stabilizing commodity prices.

“The continued slowdown in inflation is expected to boost consumer confidence, driving higher spending and consumption and fueling business expansion,” said NEDA Secretary Arsenio Balisacan.

“Additionally, easing food prices will relieve low-income households, enabling them to allocate more to other essential needs such as education and health. We will sustain the momentum as we assure the public that we will continue to pursue and carry out strategies to maintain stable prices of food and other commodities,” he added.

Balisacan said the Executive Order issued by President Ferdinand R. Marcos Jr., which reduced the rice tariffs to 15 percent, helped bring down rice prices.

“While we expect lower tariffs to reduce rice prices, we should continuously support local production through increased agricultural funding to complement this short-term measure,” Balisacan said.

The NEDA chief assured the public that the government is ready to address other inflationary pressures affecting food, such as the continuing prevalence of African swine fever (ASF), through the delivery of vaccines.

Let me end this post by asking you readers: What is your reaction to this recent development? Do you think the lower headline inflation will be helpful for local businesses that have been struggling with cutting down their expenses?

You may answer in the comments below. If you prefer to answer privately, you may do so by sending me a direct message online.

+++++

World Bank says that Philippines inflation will likely slow down this year

October 6, 2024October 4, 2024carlocarrasco

The World Bank (WB) recently announced that it sees inflation in the Philippines likely to go down this year and fall within the target range set by the Bangko Sentral ng Pilipinas (BSP), according to a BusinessWorld news report.

To put things in perspective, posted below is an excerpt from the BusinessWorld report. Some parts in boldface…

PHILIPPINE INFLATION is likely to slow this year to 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,” 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.

Let me end this post by asking you readers: What is your reaction to this recent development? Do you think inflation in the Philippines will continue to slow down as the end of 2024 approaches?

You may answer in the comments below. If you prefer to answer privately, you may do so by sending me a direct message online.

+++++

	Instapundit »… on Trump Threatens To Hit Power P…
	Vince on NATO Slammed By Trump
	Richard on NATO Slammed By Trump
	Disillusionist on NATO Slammed By Trump
	Instapundit »… on NATO Slammed By Trump

Share this:

Share this:

Share this:

Share this:

Share this:

Share this:

Share this:

Share this:

Share this:

Share this: