The latest Consumer Price Index (CPI) report showed that the Philippines’ headline inflation eased to 6.3% in August versus 6.4% in July. It was the first month since April that inflation slowed down. The figure is right in the middle of the BSP\u2019s forecast range of 5.9%-6.7%. Average inflation year-to-date (YTD) stood at 4.9%, still above the government\u2019s 2-4% target band. The BSP expects inflation to average 5.4% this year and ease to 4.0% in 2023. The BSP has already raised their key rate by 175 bps in four parts to curb price gains and support the depreciating PH Peso, which hit all time high of above PHP 57.00 to USD 1.00.<\/p>\n\n\n\n
Our View:<\/strong> The BSP should remain hawkish. With core inflation well above 4% and the PH Peso further depreciating, we expect the BSP to raise policy rates by around 50bps in their next policy meeting at the end of September.<\/p>\n\n\n\n As mentioned last week, the PH Peso is one of the worst performing Asian currencies YTD, depreciating by over 11%. The Peso will only further weaken as the U.S continues to remain hawkish with their hike rates for the foreseeable future.<\/p>\n\n\n\n Accumulate high dividend yield stocks in this market. We expect interest rates to move up towards the end of the year. We have a resistance target of the PSEi between 6,750 – 6,900 and support level of 6,550. Seeing as the market outlook looks bleak in the near future, stay anchored to stocks that provide a solid return of dividends.<\/p>\n\n\n\n In particular, DMC, SCC, SGP and TEL all provide a high 2022 dividend yield of over 7% this year.<\/p>\n","protected":false},"excerpt":{"rendered":" Here’s a commentary on an important issue or event affecting the stock market <\/p>\n","protected":false},"author":6,"featured_media":0,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[11],"tags":[],"class_list":["post-317269","post","type-post","status-publish","format-standard","hentry","category-special-reports","generate-columns","tablet-grid-50","mobile-grid-100","grid-parent","grid-33"],"_links":{"self":[{"href":"https:\/\/www.pinoyinvestor.com\/smartinvestor\/wp-json\/wp\/v2\/posts\/317269","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.pinoyinvestor.com\/smartinvestor\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.pinoyinvestor.com\/smartinvestor\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.pinoyinvestor.com\/smartinvestor\/wp-json\/wp\/v2\/users\/6"}],"replies":[{"embeddable":true,"href":"https:\/\/www.pinoyinvestor.com\/smartinvestor\/wp-json\/wp\/v2\/comments?post=317269"}],"version-history":[{"count":3,"href":"https:\/\/www.pinoyinvestor.com\/smartinvestor\/wp-json\/wp\/v2\/posts\/317269\/revisions"}],"predecessor-version":[{"id":320495,"href":"https:\/\/www.pinoyinvestor.com\/smartinvestor\/wp-json\/wp\/v2\/posts\/317269\/revisions\/320495"}],"wp:attachment":[{"href":"https:\/\/www.pinoyinvestor.com\/smartinvestor\/wp-json\/wp\/v2\/media?parent=317269"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.pinoyinvestor.com\/smartinvestor\/wp-json\/wp\/v2\/categories?post=317269"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.pinoyinvestor.com\/smartinvestor\/wp-json\/wp\/v2\/tags?post=317269"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}