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UPDATE 1-Philippine inflation slows for fourth straight month

Published 06/05/2020, 10:18 AM
Updated 06/05/2020, 10:20 AM
© Reuters.

* May annual inflation at 2.1% vs 2.2% in April
* Slower food, fuel price increases help slow inflation
* Cbank ready to use all measures to address impact of
pandemic

(Adds details, central bank statement)
By Neil Jerome Morales and Enrico Dela Cruz
MANILA, June 5 (Reuters) - Philippine inflation eased for a
fourth straight month in May, the statistics agency said on
Friday, as the country's coronavirus lockdown measures tempered
price pressures on food and fuel, offsetting higher costs for
alcoholic drinks.
Headline inflation PHCPI=ECI slowed to 2.1%, from April's
2.2%, the lowest in six months and near the low end of the
central bank's 1.9% to 2.7% forecast for the month. It matched
the median estimate in a Reuters' poll.
Inflation averaged 2.5% in the first five months of the
year, well inside the central bank's 2%-4% target.
Core inflation, which excludes volatile food and fuel
prices, was 2.9%, unchanged from the upwardly revised April
figure PHCPXY=ECI .
While the Philippines is now gradually easing its lockdown,
one of the strictest and longest in the world, any pickup in
inflation could be tempered as some restrictions remain in
place, economists said.
Tame inflation could prompt further monetary easing via
another policy rate cut or a reduction in banks' reserve
requirement ratio to support an economy facing its deepest
contraction in more than three decades, they said. The central bank, which has cut interest rates three times
this year, has sought "urgent and carefully coordinated
measures" with other agencies to ease the adverse economic
impact of the pandemic.
Central bank Governor Benjamin Diokno reiterated it stood
ready to "use all available measures in its policy toolkit" to
support economic growth.

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