Connect with us

Business and Economy

BPI-AMTC exec sees inflation within 2018 goal

Published

on

He traced this inflationary impact to higher prices of oil as a result on the increase of excise taxes on this product, among others.(Pixabay photo)

He traced this inflationary impact to higher prices of oil as a result on the increase of excise taxes on this product, among others. (Pixabay photo)

MANILA— An official of BPI Asset Management and Trust Corp. discounts breaching of the government’s two to four percent inflation target this year even with the impact of the tax reform.

In an interview, Carlos Jalandoni, BPI Asset Management and Trust Corp. vice president and head of Equities and Fixed Income Research, said the first package of the tax reform program is expected to add about 0.6-0.8 basis points on the rate of domestic price increases.

He traced this inflationary impact to higher prices of oil as a result on the increase of excise taxes on this product, among others.

He, however, noted that food prices are seen to remain manageable amid higher fuel prices.

“The food agencies in the Philippines have been quite pro-active in making sure that we have enough stocks, particularly rice. And the global prices for rice are not as volatile and so we remain fairly confident despite the fact that fuel prices are increasing. Food prices are stable, inflation will not breach four percent,” he said.

Jalandoni said impact of any weather disturbances will provide inflationary pressure but stressed that “it won’t mean sustained increases in inflation such that the average will be above four percent.

He projects inflation to go up to as high as 3.8 percent this year in the second or early third quarter because of higher demand for electricity and fuel during the summer months.

In 2017, inflation averaged at 3.2 percent, within the government’s two to four percent target for 2017 until 2019.

It peaked at 3.5 percent last October but declined to 3.3 percent in the last two months of the year.

With inflation seen to remain manageable, Jalandoni said this bodes well for their projection for a seven to 7.2 percent Gross Domestic Product (GDP) output for the economy this year.

These factors, Jalandoni said, are what make the local equities market attractive compared to the fixed income market.

Thus, the projection that the Philippine Stock Exchange index (PSEi) will hit the 9,300-9,400-level this year.

This week, the main gauge ended flat with a 0.02 percent, or 1.37 percent, uptick to 8,814.62 points.

It ended 2017 at record-high of 8,558.42 points, up 23.33 points or 0.3 percent in the last trading day of the year.

Last year, it registered 14 times of record-highs and grew by 25.1 percent year-on-year.

Jalandoni said volatility is expected in the next five years given the evolving developments overseas, with some banks keeping their interest rates at negative levels.

He, thus, expects high risk-on appetite this year as investors look for more opportunities to book gains.

He said placement in equities is really a risky undertaking but ensures sufficient long-term returns.

He also advised prospective investors to place their funds in passive funds or index trackers to ensure good returns.

Continue Reading
Click to comment

Leave a Reply

Your email address will not be published. Required fields are marked *

Maria in Vancouver

Lifestyle44 mins ago

Family Estrangement: Why It’s Okay

Family estrangement is the absence of a previously long-standing relationship between family members via emotional or physical distancing to the...

Lifestyle1 month ago

Becoming Your Best Version

By Matter Laurel-Zalko As a woman, I’m constantly evolving. I’m constantly changing towards my better version each year. Actually, I’m...

Lifestyle2 months ago

The True Power of Manifestation

I truly believe in the power of our imagination and that what we believe in our lives is an actual...

Maria in Vancouver3 months ago

DECORATE YOUR HOME 101

By Matte Laurel-Zalko Our home interiors are an insight into our brains and our hearts. It is our own collaboration...

Maria in Vancouver3 months ago

Guide to Planning a Wedding in 2 Months

By Matte Laurel-Zalko Are you recently engaged and find yourself in a bit of a pickle because you and your...

Maria in Vancouver3 months ago

Staying Cool and Stylish this Summer

By Matte Laurel-Zalko I couldn’t agree more when the great late Ella Fitzgerald sang “Summertime and the livin’ is easy.”...

Maria in Vancouver4 months ago

Ageing Gratefully and Joyfully

My 56th trip around the sun is just around the corner! Whew. Wow. Admittedly, I used to be afraid of...

Maria in Vancouver5 months ago

My Love Affair With Pearls

On March 18, 2023, my article, The Power of Pearls was published. In that article, I wrote about the history...

Maria in Vancouver5 months ago

7 Creative Ways to Propose!

Sometime in April 2022, my significant other gave me a heads up: he will be proposing to me on May...

Maria in Vancouver6 months ago

Why Eating Healthy Matters

We are what we eat, so don’t be fast, cheap, easy, or fake — we should take these words to...