Sept inflation seen below BSP’s 3-5% target range

MANILA, Philippines - The Bangko Sentral ng Pilipinas (BSP) expects the September inflation rate to remain below the full-year target range of three to five  percent in September.

In a text message, BSP Governor Amando M. Tetangco Jr said inflation  is forecast to settle within  the 1.9 to 2.8 percent  range in September due to  a stable food prices and lower  fuel rates.

“Prices of premium gasoline declined while prices of vegetables and fish stabilized after the monsoon rains. However, price increases in rice, selected oil products, and electricity rates were noted during the month,” Tetangco said.

Inflation slid to a four-year low in August at 2.1 percent due to a fall in fuel and utility rates. The decline in the consumer price index was observed despite the typhoons that battered the country during the period.

For the first eight months, inflation stood at an average rate of 2.8 percent, below the BSP’s three to five percent target range for the year.

The BSP said it will continue to assess developments affecting domestic prices to make sure this is in line with sustaining economic growth.

“The BSP will continue to closely monitor the developments that shape the outlook in prices and economic activity to ensure that monetary policy is directed at safeguarding price stability in an environment of sustained economic growth,” Tetangco said.

The economy has expanded by 7.5 percent in the second quarter, the fastest growth rate in Southeast Asia. This brought first half growth to 7.6 percent, already above the government’s target of six to seven percent.

The robust economic growth coupled with manageable inflation allowed the BSP to keep its policy rates unchanged since the start of the year.