Inflation likely quickened in September, with most economists expecting it to return to the Bangko Sentral ng Pilipinas (BSP)’s two to four percent target for the first time in six months, following a sustained stretch of subdued price growth.
Forecasts gathered by The STAR show inflation may have accelerated to between 1.9 and 2.5 percent last month. If inflation does breach the target in September, it would mark the first time it has climbed above two percent since February’s 2.1 percent print.
Metrobank chief economist Nicholas Mapa expects inflation to rise to 2.5 percent in September, citing upside pressures in vegetable and fish prices due to the impact of recent typhoons.
Lower electricity rates could partly offset the upside pressures in food prices, while pump prices may provide limited relief. ‘Pump prices also could be a source of downside pressure, but to a lesser extent, as gasoline and diesel costs increased on a monthly basis, tracking global markets,’ Mapa said.
Rizal Commercial Banking Corp.chief economist Michael Ricafort placed his own September inflation forecast at 2.1 percent year-on-year. He also said inflation could rise to two percent levels for the rest of the year.
UnionBank of the Philippines chief economist Ruben Carlo Asuncion penciled in a milder two percent print, up from 1.5 percent in August and 0.9 percent in July.
‘Upside risks stem from weather-related supply disruptions, higher wages in Metro Manila and faster cost pass-through, with core inflation already at 2.7 percent in August,’ Asuncion said.
‘On the other hand, continued rice deflation from tariff cuts and imports, soft global oil prices, weak China producer prices and subdued fiscal spending continue to provide downward pressure,’ he added.
Jonathan Ravelas, senior adviser at Reyes Tacandong and Co., also expects inflation at 1.9 percent, attributing the increase mainly to food and transport costs.
‘The projected increase in September was mainly due to higher food and vegetable prices, plus some transport cost adjustments. It’s a reminder that food supply remains vulnerable,’ Ravelas said.
He added that inflation could edge higher in the last quarter due to holiday demand, weather risks and oil market movements. ‘But barring major shocks, it would likely stay below or at two percent,’ Ravelas said.
Bank of the Philippine Islands lead economist Jun Neri likewise projected a 1.9-percent reading in September or about 0.2 percent higher on a month-on-month basis. Neri attributed the uptick to higher fish prices amid heavy rains and rising rice costs following the government’s suspension of rice imports.
He pointed out that lower electricity rates, cheaper vegetables and softer oil prices partly offset these upward pressures.
Neri cautioned that inflation risks are tilted upward in the coming months, with rice supply pressures and base effects expected to push consumer prices higher in the early part of 2026.
‘Nonetheless, we still project inflation to stay at the two percent level through December, but could climb above three percent in the first half of next year,’ Neri said, adding that an influx of cheap Chinese exports may temper price pressures.
The Philippine Statistics Authority is set to release the official inflation report on Oct. 7, just two days before the BSP’s policy meeting, where markets are weighing whether the Monetary Board will slash policy rates further or keep the benchmark steady at five percent.
Economists agree that the upcoming inflation print will be a crucial input for the BSP’s next policy decision. A higher-than-expected number could bolster the case for a pause after the August rate cut, while a still-subdued print would leave room for the Monetary Board to ease further.
The central bank has already cut rates by 150 basis points since August 2024 to support growth amid benign inflation.