The trade deficit narrowed in May to US$3.28b from US$3.50b in April, better than consensus expectation of US$3.74b. Exports grew 1% YoY to US$6.15b on higher electronics shipments while imports fell 5.4% YoY to US$9.43b due partly to high-base effect. January-May 2019 trade deficit was US$16.5b.

The index broke the resistance level of 8,100 and managed to close the week at 8,117.94, a gain of 118 pts (+1.48%) from the previous week. Value turnover was low at $112m (P 5.7Bn) and foreigners were net sellers of $7m (P 358m). The low turnover was due to the holidays in the US and Hong Kong which limited foreign participation.

The BSP kept its policy rate unchanged at 4.5% (overnight borrowing facility) However, BSP Governor Benjamin Diokno said future rate cuts are inevitable but the timing would be data dependent and evidence-based. The BSP revised downward its 2019 and 2020 inflation rate forecasts further to 2.60% from 2.9% partly due to lower average global crude oil prices.