Surging Rice Prices Batter Bonds in Major Importer Philippines
- Philippines is one of the world’s top buyers of rice
- Rising inflation increases risk of a BSP rate hike this month
White rice in a godown in Gurgaon, India.
Photographer: Anindito Mukherjee/BloombergThis article is for subscribers only.
The highest rice prices in 15 years are threatening to worsen inflation in the Philippines and pummel the nation’s local bonds that are already underperforming regional peers this quarter.
Investors have withdrawn $13 million from Philippine bond exchange-traded funds in the four weeks ended Sept. 8, after an inflow of nearly $9 million in the preceding one-month period. That’s after inflation in August surged as India’s rice export curbs pushed up purchase costs for the Philippines, which is one of the world’s top buyers of the staple grain.