S&P said the uptick was driven by stronger new orders, which encouraged manufacturers to raise production for a second straight month.
THE Bangko Sentral ng Pilipinas’ Memorandum No. 2026-027, granting temporary regulatory relief to banks, which will last eight months, starting April till yearend 2026, helps ensure that they will be able to extend credit during the current period of uncertainty as a result of the crisis in the Gulf.
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The Bangko Sentral ng Pilipinas’ (BSP) rate tightening cycle may be far from over despite inflation easing for two consecutive months, according to Bank of the Philippine Islands (BPI) lead economist Emilio Neri Jr.
In a recent commentary, Neri said the upcoming El Niño season and lingering Gulf-driven inflationary pressures could prompt the central bank to raise interest rates further, even as inflation slowed to 6.4 percent in June.
“While headline inflation has slowed, core inflation continues to trend higher, indicating that price increases are becoming more widespread beyond food and energy,” he said. “Additional rate hikes could temper economic activity, but the adverse effects of elevated inflation may be more detrimental to growth.”
The Philippine Statistics Authority (PSA) earlier reported that the slowdown in overall inflation in June was primarily driven by a softer increase in transport costs, with the transport index rising 12.8 percent from 16.2 percent in May.
However, the PSA also reported that core inflation, which excludes volatile items such as food and energy, accelerated to 4.4 percent in June from 4.1 percent in May. The BSP has said this reflects broadening price pressures, second-round effects and rising inflation expectations.
BSP Governor Eli Remolona Jr. last week said the economy remains capable of absorbing further monetary policy tightening, citing the country’s strong economic fundamentals.
“Kayang-kaya pa (It definitely still can),” he said.
“That is a significant achievement — 6 percent growth over several years. Some fundamentals are in place, and they are good fundamentals. Our job now is to sustain that momentum and, hopefully, reduce inequality and poverty. We have the fundamentals to work with,” Remolona added.
