MANILA – Inflation will likely be “low and stable” this year and next, the Bangko Sentral ng Pilipinas said Friday, adding it was “optimistic” about growth prospects.
Consumer prices rose 5.1 percent in December, the lowest since June 2018 and below analysts’ estimate of 5.6 percent. The annual rate slowed from 6 percent in November.
The BSP maintained its inflation forecasts of 3.2 percent this year and 3 percent in 2020, said Deputy Governor Diwa Guinigundo, the central bank’s officer in charge.
“We are optimistic that with the early implementation of the rice tariffication law and sustained reforms in supply logistics we should be seeing low and stable inflation this year and 2020,” Guinigundo said in a statement.
“With lower price movement, we could be optimistic about the growth prospects and their positive feedback to inflation,” he said.
The Bangko Sentral, which raised the benchmark lending rate by 1.75 percentage points in 2018, will “confront the issue of inflation with appropriate and vigilant stance of monetary policy,” he said.
Inflation would have been “disanchored beyond reasonable proportions” without “aggressive monetary tightening,” he said.
“Decisive” government action, including cracking down on hoarding and profiteering also contributed to slower inflation, he said. (ABS-CBN News)
