MANILA – Philippine monetary officials have renewed confidence in hitting inflation targets following the fall of June’s inflation rate to 2.7 percent from 3.2 percent in the previous month.
The Philippine Statistics Authority (PSA) attributed the big drop to the second consecutive slide of rice inflation and the deceleration of the education index.
Last June’s inflation rate was way lower than year-ago’s 5.2 percent, while average inflation in the first half this year stood at 3.4 percent.
Excluding volatile items, such as food and oil products, core inflation slowed to 3.3 percent from May’s 3.5 percent, bringing the six-month average to 3.7 percent. Core inflation in June 2018 was higher at 4.3 percent.
Bangko Sentral ng Pilipinas (BSP) governor Benjamin Diokno told reporters that the inflation rate last month, which is within the central bank’s 2.2 percent to 3 percent target band, “is consistent with the BSP’s prevailing assessment that inflation will firmly settle within the target range of 3.0 percent +/- 1.0 percentage point for 2019 and 2020.”
In its meeting last June 21, the BSP’s policy-making Monetary Board cut the central bank’s average inflation forecast for this year to 2.9 percent from 3.1 percent last May and the 2020 to 2.7 percent from 3 percent.
“The BSP will keep close watch over latest economic developments to ensure that the monetary policy stance remains consistent with the BSP’s price stability objective while being supportive of economic growth,” Diokno added. (PNA)
