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Philippines: BSP sees May inflation at above 4%
The Bangko Sentral ng Pilipinas (BSP) said the country’s headline inflation rate for May likely remained at above 4 percent.
“The BSP projects May 2021 inflation to settle within the range of 4.0 to 4.8 percent,” said BSP Governor Benjamin Diokno in a statement on Monday.
Headline inflation settled at 4.5 percent last month while inflation in May last year was at 2.1 percent.
The Philippine Statistics Authority (PSA) will release official May inflation data on June 5.
“Higher prices of meat and domestic petroleum products along with the upward adjustment in Meralco (Manila Electric Co.) electricity rates are the main sources of upward price pressures for May,” said Diokno.
Local oil companies last week raised the prices of diesel and gasoline by 25 centavos per liter and 15 centavos per liter, respectively.
Meralco also increased rates by P0.1853 per kilowatt-hour (kWh) in May, bringing the monthly rate to P8.5920 kWh.
“These could be offset by the decline in prices of key food items, such as rice, vegetables and fish, due to improved supply conditions, along with the appreciation of the peso,” said Diokno.
The Philippine peso appreciated against the US dollar by 0.185 centavos or 0.4 percent to close at P47.80:$1 last May 28.
“Moving forward, the BSP will remain watchful of economic and financial developments to ensure that the monetary policy stance remains consistent with the BSP’s price stability mandate,” said Diokno.
The BSP earlier said the country’s headline inflation is projected to average 3.9 percent this year, down from its earlier 4.2-percent forecast as price pressures on food commodities ease due to improving weather conditions, the effect of Executive Order (EO) 128 and Proclamation 133, and the impact of non-monetary direct measures to relieve supply constraints.
EO 128 allows for the importation of an increased volume of pork products at lower tariffs.
Proclamation 133, meanwhile, placed the country under a state of calamity due to the African swine fever (ASF) that will allow local government units to use part of their calamity funds to counter the spread of ASF.
Source: https://www.manilatimes.net/2021/06/01/business/top-business/bsp-sees-may-inflation-at-above-4/1801467