MANILA – The Philippines’ inflation rate further accelerated in December 2019 to 2.5 percent but the Bangko Sentral ng Pilipinas (BSP) is not worried, saying the level remains within its projection.
Faster inflation of electricity rates, petroleum products, select food items, and the base effects of the previous year’s elevated rate of price increases pushed inflation higher than last November’s 1.3 percent. December’s figure is within the central bank’s 1.8 percent to 2.6 percent forecast.
“The latest inflation outturn is consistent with the BSP’s prevailing assessment that inflation is expected to approach the midpoint of the target range in 2020 and 2021,” the central bank said in a statement Tuesday.
Inflation in 2018 was higher at 5.2 percent while the average rate last year stood at 2.5 percent, within the government’s 2 percent to 4 percent target band.
The BSP said risks to inflation outlook “are on the upside” this year “but titled on the downside” next year.
It identified the volatility of global oil prices and the potential impact of the African swine fever as the upside risks for this year’s inflation rate, while the impact of global trade and policy uncertainty, as well as geopolitical issues, are among the downside risks.
“The BSP will consider all the latest economic developments here and abroad in the Monetary Board’s assessment to ensure that the monetary policy stance remains consistent with the BSP’s price stability objective while being supportive of economic growth,” it added. (PNA)
