Thailand
Philippines: February inflation likely breached 9%
MANILA, Philippines — Inflation likely remained stubbornly high and could have breached nine percent in February from a fresh 14-year high of 8.7 percent in January, according to the Bangko Sentral ng Pilipinas (BSP).
In a statement, the central bank said inflation last month likely settled between 8.5 percent and 9.3 percent, with upward pressures emanating from higher prices of liquefied petroleum gas as well as elevated prices of key food items such as pork, fish, eggs and sugar.
The last time inflation breached nine percent was in November 2008 at 9.1 percent.
On the other hand, the BSP said the lower prices for domestic petroleum, fruits and vegetables, chicken and beef, along with the peso’s appreciation could help ease price pressures in February.
“The BSP will continue to adjust its monetary policy stance as necessary to prevent the further broadening of price pressures, as well as the emergence of additional second order effects,” it said.
The BSP said it would continue to monitor closely emerging price developments in accordance with its price stability mandate.
Inflation quickened to 5.8 percent last year, exceeding the central bank’s two to four percent target range, from 3.9 percent in 2021 due to soaring global oil prices arising from Russia’s invasion of Ukraine as well as elevated food prices due to supply shocks caused by the zero-COVID policy in China.
Based on its latest assessment, the BSP raised its inflation forecasts to 6.1 percent from 4.5 percent for 2023 and to 3.1 percent from 2.8 percent for 2024.
To tame inflation and anchor inflation expectations, the central bank has raised key policy rates by 400 basis points, including the recent 50-basis-point hike delivered on Feb. 16.
The move was meant as a strong follow-through monetary policy response to reduce the risk of a breach in the inflation target in 2024.
Likewise, the upward adjustment in the policy interest rate would also prevent inflation expectations from drifting farther away from the target band.
“The BSP reassures the public that it stands ready to take all necessary policy action to bring inflation to within the two to four percent government target over the medium term, in line with its primary mandate of ensuring price stability,” it said.
During the briefing of the Development Budget Coordination Committee (DBCC) before the committee on appropriations at the House of Representatives, BSP Governor Felipe Medalla said the government is confident that inflation would ease back to within the two to four percent target range by the fourth quarter or early next year.
“We think that inflation will normalize by late this year or early next year. So we expect policies will adjust accordingly. Exactly by how much, I do not want to say because I am just one vote,” Medalla said.
Source: https://www.philstar.com/business/2023/03/01/2248305/february-inflation-likely-breached-9