The Bangko Sentral ng Pilipinas (BSP) reported a slight improvement in consumer confidence in the first quarter of 2026, although sentiment for the months ahead weakened amid concerns over inflation and governance.
Based on the BSP’s Consumer Expectations Survey, household sentiment in the current quarter improved but remained in negative territory. The confidence index (CI) rose from -22.2 percent in the fourth quarter of 2025 to -15.8 percent in the first quarter of 2026, reflecting reduced pessimism among consumers.
The BSP said the improvement was driven by expectations of higher income, more stable employment, additional sources of earnings, and increased labor force participation among family members.
Despite the improvement, consumer outlook for the near and longer term weakened. The quarter-ahead CI declined from 3.6 percent to 1.8 percent, while the year-ahead CI dropped from 11.8 percent to 9.6 percent.
The central bank attributed the softer outlook to concerns over inflation and perceptions of graft and corruption, which households believe may affect the delivery of government services.
Inflation expectations remained steady and within target. The survey showed households expect inflation to stay below the BSP’s 3 percent target for 2026 and within its ±1.0 percentage-point range.
The BSP noted that the survey was conducted before the onset of the ongoing Middle East conflict, which could affect future consumer sentiment and inflation expectations depending on developments in global oil prices and supply conditions.
It added that it continues to monitor external risks, including geopolitical tensions, and stands ready to take appropriate monetary policy actions if inflationary pressures intensify. The BSP also said it has introduced regulatory measures allowing banks to extend assistance to affected clients.
The Consumer Expectations Survey is one of the BSP’s key tools for assessing economic conditions and guiding monetary policy decisions.