Inflation in the Philippines is expected to cool further this March—possibly slipping below 2%—thanks in part to favorable weather that’s boosted the country’s agricultural production.
Rizal Commercial Banking Corporation (RCBC) chief economist Michael Ricafort shared the forecast in a Viber message to the Philippine News Agency on Friday, predicting a slowdown to 1.9% in March, down from 2.1% in February.
That figure would dip below the Bangko Sentral ng Pilipinas’ (BSP) target range of 2% to 4%, signaling a continued easing of price pressures nationwide.
“March has seen generally better weather, especially in northern areas of the country, with some rain brought about by the ongoing La Niña,” Ricafort explained. “This has helped increase agricultural output, boosting local supply and easing price pressures.”
While meat prices have stayed relatively high, Ricafort said these have been offset by higher pork imports and the implementation of a maximum suggested retail price (SRP) for pork on March 10.
Several other key factors are also contributing to the downtrend in inflation:
- The SRP on imported rice, which took effect on January 20, 2025
- The government’s declaration of a food security emergency on February 3, 2025
- Global rice prices, which have dropped to their lowest in over three years
All these measures are helping to push down local rice prices, which are a significant component of the inflation basket, accounting for around 9%.
Ricafort also pointed to the stronger peso, now at ₱57.20 to the US dollar from ₱57.99 in February, as a positive sign. A stronger peso means lower import costs, which helps keep overall inflation in check.
Add to that the continued drop in global crude oil prices, and the inflation outlook is clearly softening.
With inflation now well within the target range, Ricafort said the BSP may have more breathing room to cut interest rates, which could further stimulate economic activity.
The Philippine Statistics Authority is set to release the official March 2025 inflation data on April 4.