August 31, 2019
INFLATION likely decelerated further this month on the back of lower fuel, rice and power prices, the Bangko Sentral ng Pilipinas (BSP) announced on Friday.
In a statement, the central bank said its Department of Economic Research projected consumer price growth “to settle within the 1.3- [to] 2.1-percent range” in August.
The forecast is lower than July’s 2.4 percent and the 5.7 percent posted in August 2018.
The Philippine Statistics Authority (PSA) is set to release official August inflation data on September 5.
The BSP said “lower domestic prices [of] gasoline, diesel and kerosene; the continued decline in rice prices; [and] the downward adjustment in electricity rates dampened inflation pressures during the month.”
Energy companies implemented a per-kilogram price rollback of 10 centavos per liter for both gasoline and diesel effective August 27.
Latest PSA data show that rice prices decreased in the second week of August, with the average price of regular milled rice dipping by 9.8 percent from P38.38 per kilogram the week before.
The Manila Electric Co.’s per kilowatt-hour (kWh) rate for households consuming 200 kWh monthly was trimmed by P0.4176 this month.
“These could be partly offset by the recent depreciation of the peso and higher prices of selected food items,” the Bangko Sentral said.
The local currency returned to the P52:$1 level in August after hitting its strongest level so far this year on July 30, when it closed P50.89 against the US dollar.
“Moving forward, the BSP will remain watchful of economic and financial developments that could affect the inflation environment in line with its commitment to price stability conducive to long-term economic growth,” the central bank said.
On August 8, monetary authorities cut their 2019 inflation forecast to 2.6 percent from 2.7 percent, and their 2020 projection to 2.9 percent from 3.0 percent. They also forecast inflation to settle at 2.9 percent in 2021.
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