The reason why the food basket inflation dropped is because the rice component is negative,” he said in a briefing yesterday. BSP Governor Benjamin Diokno said last month’s inflation rate is consistent with the BSP’s prevailing assessment that inflation will firmly settle within the target range. The regulator also lowered the reserve requirement ratio for big and mid-sized banks by 200 basis points and for small banks by 100 basis points to free up about P210 billion in additional liquidity into the financial system to boost economic activity. “We forecast another 25 basis points rate cut in Q3, likely in August, given our outlook for GDP growth to still register below six percent in Q2. For his part, Bank of the Philippine Islands lead economist Jun Neri said he expects another rate cut by the BSP before the end of the year.

Source: Philippine Star July 05, 2019 16:00 UTC