Economists have revised anew their inflation forecast for the Philippines as the strong peso continues to normalize inflationary pressures, the Bangko Sentral ng Pilipinas (BSP) said in a survey. Based on the BSP’s “Private Sector Economists’ Inflation Forecast," inflation would average at 4 percent this year instead of 4.5 percent, and 4.1 percent next year instead of 4.8 percent. “[Economists] noted that the fragile economic recovery as well as the firm peso will temper inflationary pressures," the BSP said over the weekend. Forecasts of various groups Financial services groups have revealed the following forecasts for this year:
ATR KimEng Financial Corp. sees inflation to average at 4.3 percent; Deutsche Bank, Hongkong and Shanghai Banking Corp. (HSBC), and Metrobank Group at 4.2 percent; ING Investment Management and the Philippine Equity Partners Inc. (PEP) at 3.9 percent; Rizal Commercial Banking Corp. (RCBC) at 3.8 or 3.9 percent; and think tank IDEA at 3.7 percent. For 2011, their forecasts are: ATR KimEng believes inflation will average at 4.9 percent; HSBC says it will be 4.5 percent; Deutsche Bank places inflation at 4.4 percent; ING at 4.3 percent; PEP at 3.9 percent; RCBC between 3.5 to 4.5 percent, and IDEA at 2.4 percent. “Based on the results of the BSP’s survey for September 2010, inflation is expected to be within the target ranges for both 2010 and 2011," the BSP said. The central bank has set an inflation target of between 3.5 and 5.5 percent this year. Meanwhile, the BSP places inflation between 3 and 5 percent for next year until 2014. The National Statistics Office data showed that inflation eased to 4.1 percent in the first nine months of the year from 4.2 percent in the same period last year. The Monetary Board has kept its record-low borrowing rate at 4 percent and lending rate at 6 percent. — JE/VVP, GMANews.TV 
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