Average inflation for the first 2 months of the year is at 3 percent, exactly at the midpoint of the government’s target range. This is consistent with our expectation that inflation will settle within the target range of 2 –4 percent in 2017 and 2018. This environment gives us a sound basis to be optimistic about the Philippine economic outlook.
This highlights the inadequate flow of credit to services sector. There is a need for banks to go to the interiors, to mofussil towns and cities and expand credit linkage in those areas. There is a mass of people residing in these places that are willing to provide security to obtain credit, but are, currently, not getting the credit.