THE abrupt decline in world oil prices and the normalization in supplies of rice and other agricultural goods caused Philippine monetary officials to forecast a November 2018 inflation of between 5.8 percent and 6.6 percent, lower than the 6.7 percent last September and October.
In a statement Thursday, the Bangko Sentral ng Pilipinas’ (BSP) Department of Economic Research said the appreciation of the peso also contributed to their projection of slower inflation for the 11th month this year.
For one, the peso has improved against the US dollar and traded at the 53-level from 54-level a few weeks back.
The price of rice has also declined after supply from the National Food Authority (NFA) increased following the directive from Malacañang for NFA to immediately release last September its rice stocks from its warehouses nationwide.
These factors, the statement said, would counter the impact of jeepney and bus fare hikes, along with the uptick in electricity rates in areas serviced by the Manila Electric Company (Meralco).
“Moving forward, the BSP will remain watchful of economic and financial developments to ensure the achievement of its primary mandate of price stability conducive to balanced and sustainable economic growth,” it added.
Authorities expect a deceleration in the rate of price increases following the steady rate last October.
They expect the average inflation rate this year to be above the government’s 2 percent to 4 percent target, but also predict that it will settle back to “within target levels” next year. (PNA)