Budget Secretary Benjamin Diokno remains optimistic July’s inflation rate will be within target ahead before the Philippine Statistics Agency releases the official figures on 7 August.

Diokno said in a statement other members of the government’s economic team are also expecting the decline, noting that it will be lower than the previous month’s tally of 5.2 percent.

“We expect inflation to start tapering off the second half of the year and it will go back to normal in 2019,” said Diokno.

The budget chief explained the surge in the international prices of oil coupled with a weaker peso might have pushed the inflation rate higher in the first half of the year.

“Things are taking a different turn at the second half of the year,” Diokno said. “Although oil prices are still erratic, we expect the oil prices to decrease.”

“We are also expecting the exchange rate to go down,” he added.

While the Tax Reform for Acceleration and Inclusion (TRAIN) law may have put pressure on some prices of commodities, Diokno said they would instead look at the other side of the coin with 99 percent of income tax filers benefiting from the tax reform law by putting more money inside the pockets of individuals.

“Our rough estimate is that TRAIN has increased your budget take-home pay equivalent to one month salary,” said Diokno. “We are in a very nice place. Right now we are one of the fastest growing countries.”

Trade Undersecretary Ruth Castelo, on the other hand, is also looking forward to a lower inflation figure for July which will be formally announced on Tuesday.

“Inflation rate is expected to normalize by the end of 2018, but it is also expected to go down a little bit for July,” Castelo said.

It reached 5.2 percent in June, a big jump from the inflation rate recorded since the start of the year when the TRAIN Act took effect.