MANILA — The Bangko Sentral ng Pilipinas (BSP) expects the country’s inflation to remain within the 2 to 4-percent target band until 2021 after rate of price increases decelerated to its lowest level in almost three years.
The inflation rate further declined to 1.7 percent in August 2019 from the previous month’s 2.4 percent, and within the central bank’s 1.3 to 2.1-percent projection, with the drop attributed to lower prices of rice, electricity, and fuel products.
Average inflation as of end-August stood at 3 percent.
“The latest inflation outturn is consistent with the BSP’s prevailing assessment that inflation will continue to decelerate in Q3 (third quarter) 2019 and pick up slightly in Q4 2019,” the central bank said in a statement Thursday.
The BSP said monetary officials expect inflation to settle within the government’s 2 to 4-percent target range over the next three years, with the manageable inflation traced to ample domestic food supply and lower prices of oil in the international market.
“At the same time, deepening trade tensions between China and US, along with ongoing geopolitical risks, have raised global economic uncertainty which poses a downside risk to the inflation outlook,” it said.
“The BSP will continue to keep a close watch over latest economic developments here and abroad to ensure that the monetary policy stance remains consistent with the BSP’s price stability objective while being supportive of economic growth,” it added.
Data released by the Philippine Statistics Authority (PSA) Thursday showed that the inflation rate last August is the lowest since October 2016’s 1.8 percent.
Also, core inflation, which excludes volatile oil and food items, slowed to 2.9 percent compared to the previous month’s 3.2 percent, bringing the average to date to 3.6 percent. Joann Villanueva/PNA – northboundasia.com