The Department of Finance (DOF) said that most private sector institutions have overshot their September inflation forecasts, noting that analysts appeared to have expected the worst last month.
In a statement, the DOF said on Monday, Oct. 11, that analysts from the private sector had a median inflation projection of five percent for September, higher than the actual headline rate of 4.8 percent for the period.
The DOF said only John Paolo Rivera of the Asian Institute of Management, and Emmanuel Lopez of the Colegio de San Juan de Letran, projected a lower rate of 4.5 percent and 4.7 percent, respectively, while 15 others placed their forecasts between 4.9 and 5.2 percent.
Standard Chartered Economist Jonathan Koh, and Citi's Nalin Chutchotitham, predicted the September inflation rate to be at 4.9 percent.
Philippine National Bank Vice President and Head of Equity Research Division Alvin Joseph Arogo, Sun Life Financial's Patrick Ella, and ING Bank NV Manila Senior Economist Nicholas Antonio Mapa, meanwhile, predicted inflation at five percent.
Moreover, Ateneo de Manila University (ADMU) Economist Ser Percival Peña-Reyes, Rizal Commercial Banking Corp.'s Michael Ricafort and Moody’s Analytics Senior Asia-Pacific economist Katrina Ell also forecasted the inflation rate at five percent.
Bank of the Philippine Islands Lead Economist Emilio Neri, Jr., Security Bank Corp. Chief Economist Robert Dan Roces, BDO Unibank’s Jonathan L. Ravelas, GlobalSource Partners Analyst Romeo Bernardo and Union Bank of the Philippines’ Ruben Carlo Asuncion, projected inflation to reach 5.1 percent.
Meanwhile, De La Salle University’s Mitzie Irene Conchada and Pantheon Economics' Miguel Chanco both gave a 5.2 percent forecast.
“Analysts from the private sectors appeared to have expected the worst as the median inflation rate is at 5 percent, slightly above the actual September 2021 inflation," said DOF quoting a newspaper poll.
According to the DOF, the country’s headline inflation slightly eased to 4.8 percent in September 2021 from 4.9 percent, which is within the 4.8 to 5.6 percent estimate of the Bangko Sentral ng Pilipinas (BSP).
The Philippine Statistics Authority (PSA) said the easing of the overall inflation in September was mainly a result of the lower annual rate of increment in the transport index at 5.2 percent from 7.2 percent in the previous month.
The latest figures now put the average inflation to 4.5 percent, above the BSP’s target range of 2 percent to 4 percent.
“BSP Governor Benjamin Diokno stated that the inflation rate is expected to remain elevated in the coming months before it settles to target levels before the end of 2021,” the DOF said.
Diokno has also mentioned that supply-side factors such as weather disturbances, global oil prospects, and the African swine fever (ASF) continued to drive the inflation rate.