BSP flags downside inflation risks in 2026MANILA, Philippines — The Bangko Sentral ng Pilipinas sees inflation risks in 2026 tilted to the downside, with new analysis showing a high chance that price growth could slip below the lower end of the government’s target range as global commodity prices stay benign and domestic pressures remain muted. During low inflation periods, expectations play a bigger role than current inflation. External factors also matter more when inflation risks are on the upside. Meanwhile, domestic indicators such as the output gap and credit gap were found to have little influence on 12-month ahead inflation risks compared with external shocks. On the downside, the BSP said inflation expectations are the key driver, particularly in an environment of sustained low inflation.

Source: Philippine Star January 12, 2026 05:47 UTC