Stocks plunge on surprise high August inflation data

Local share prices plunged after August inflation came out to be higher than worse case estimates by both government and the private sector.

The Philippine Stock Exchange index (PSEi) fell 129.55 points, or 1.64 percent, to close at 7,752.27, below the 7,800 immediate support level, as share prices fell across the board.

“The PSEi kicked off the day lower by -26.33 points, tracking our peers in SEA as well as the wider continent as markets in Europe and the US retreated overnight. The losses started to widen approaching the release of inflation data,” said Philstocks Financial Head of Research Justino Calaycay Jr.

He noted that, there is “no need to further belabor the point – Wednesday’s big story was inflation. While many expected the number to turn out higher than the previous, what proved to be the last straw was that even government itself missed.”

The central bank meets on September 27 and investors will look for cues about a potential increase in interest rates.