(Bloomberg) -- Inflation in the Philippines halted four consecutive months of acceleration in June, further building the case for the central bank to start its pivot to monetary policy easing as early as next month.

Consumer prices rose 3.7% on-year last month, the statistics agency said Friday, with the latest data slower than the 3.9% print in May and the median 3.9% forecast by economists in a Bloomberg survey. Inflation decelerated because of slower rises in the prices of utilities and transport.

The latest inflation print stayed within the Bangko Sentral ng Pilipinas’ 2% to 4% goal, and defied its expectations of a breach in the second quarter. Rice inflation came in at 22.5% compared with 23% in May, showing that price pressures from the staple grain continued to ease, and will further cool as lower import tariffs take root.

“There’s a higher chance of an August rate cut, with peso - which seems to be ‘behaving’ — a part of the decision point,” said Dan Roces, chief economist at Security Bank Corp. The Philippine stock index climbed as much as 0.8% after the inflation print, while the peso was little changed.

The June inflation data reinforce BSP Governor Eli Remolona’s signal last week that an August rate cut has become somewhat more likely than before. His comments followed signs of strains in domestic demand as the benchmark rate remained at its highest level in 17 years.

The BSP, in a statement following the price print, said it will ensure monetary policy settings are in line with its mandate to keep stable prices “conducive to sustainable economic growth,” indicating it’s keeping a close eye on domestic output.

The central bank also said Friday that inflation will settle within target this year and next, with price expectations remaining well-anchored and the balance of price risks shifting to the downside this year and next. Still, it flagged lingering pressures from food items other than rice, transport and power costs.

--With assistance from Cecilia Yap and Shinjini Datta.

(Updates with central bank statement in sixth paragraph.)

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