With price pressures steadily easing from its peak level last year, inflation print for the month of May was seen to slip below three percent, the Bangko Sentral ng Pilipinas (BSP) said on Friday.
“The BSP Department of Economic Research projects May 2019 inflation to settle within the 2.8 to 3.6 percent range,” the central bank said.
This outlook, despite coinciding within the government’s two to four percent target band, proved to be slightly higher than its forecast range for April with inflation pencilled to settle within 2.7 percent to 3.5 percent.
Likewise, the recent inflation figure compares to the actual three percent inflation for the month of April 2019.
According to the BSP, this projection can be attributed to lower rice and domestic oil prices coupled with downward adjustment in electricity rates for the month.
However, upside price pressures from jeepney fare adjustment in Central Visayas and higher prices of selected food items could offset inflation expectations.
In addition, ING Bank senior economist Nicholas Mapa casted earlier an improved inflation projection for 2019, pencilling full-year inflation to hit 2.9 percent given the significant decline in rice prices coupled with the BSP’s dovish leaning.
In summary, the central bank reiterated on its commitment to its primary mandate of ensuring price stability.
“Looking ahead, the BSP will continue to be watchful of evolving price trends to ensure that the monetary policy stance remains consistent with maintaining price stability,” it concluded.