Find out why analysts expect 2.8% inflation print for the Philippines

Transport component actually slipped.

According to DBS, May inflation numbers are due today and a muted print of 2.8% YoY is expected. The pass-through from easing oil prices over the past few months are starting to be felt. 

Notably, in YoY terms, the transport component of the CPI basket actually registered a -0.7% decrease.

Here's more from DBS:

Similarly, food prices, which have the largest weighting in the CPI basket, have been stable over the past 3-4 quarters, registering an increase of just 2.2% YoY.

Benign food and energy prices have allowed headline inflation to drift lower, putting the economy firmly in a sweet spot of high GDP growth and low inflation.

Nonetheless, a mild updrift in inflation is expected through the rest of this year as economic growth momentum is maintained. A likely pickup in the pace of loan growth after hefty cuts in the special deposit account (SDA) rate should also help to stimulate economic activity in the coming months.

Structurally, the high unemployment rate may also help to reduce wage pressures even as the economy moves to a higher growth trajectory of 6-8%.