BSP pegs January inflation at 2.5%-3.3%
MANILA, Philippines — Consumer price growth likely picked up in January amid upward pressures from higher prices of some food items and excise taxes on cigarettes, the Bangko Sentral ng Pilipinas said Friday.
In a statement, the BSP’s Department of Economic Research said it expects January inflation to settle within 2.5%-3.3% range.
If the upper-end of the central bank’s forecast range is realized, that would be quicker than December’s record of 2.5%.
The BSP higher prices of LPG and selected food items likely put upward price pressure in the first month of 2020. Adjustments in the excise taxes on tobacco products could’ve also fanned inflation this month.
But lower electricity rates in areas serviced by Meralco, the country’s largest power distributor, and rollbacks in local pump prices likely tempered inflation in January, the central bank added.
“Moving forward, the BSP will continue to monitor evolving price trends to ensure that the monetary policy stance remains consistent with the mandate of maintaining price stability conducive to economic growth,” it said.
In 2019, inflation averaged 2.5%, settling within the state’s 2%-4% annual target.
Since becoming central bank governor, Benjamin Diokno has given the economy a shot in the arm with a cumulative 75-basis point rate cut in 2019 and a 400-basis point reduction in bank reserves.
Diokno had said it was logical for the central bank to dial back the 175-basis point cumulative hikes fired off in 2018, which saw inflation peak at a near-decade high in September and October amid food supply bottlenecks at the time.
He added that the central bank still has some room to resume its monetary policy easing in 2020, but it won’t be as aggressive as last year.
- Latest
- Trending
