Inflation likely to ease anew in December – BSP
Credit to Author: MAYVELIN U. CARABALLO, TMT| Date: Fri, 28 Dec 2018 16:15:28 +0000
The Bangko Sentral ng Pilipinas (BSP) expects inflation to continue easing in December, on Friday issuing a 5.2-6.0 percent forecast for the month.
The upper end of the range marks the result for November, when inflation finally started decelerating after rising since the start of the year.
“The sustained slowdown of inflation during the month is seen to be driven mainly by the continued decline in petroleum and rice prices, the rollback in minimum jeepney fare, and the slight appreciation of the peso,” the BSP said.
Oil companies implemented pump price cuts four times this month, extending a run of rollbacks, and regulators subsequently decided to cut jeepney fares that were earlier hiked due to soaring fuel prices.
The peso, meanwhile, returned to the P52 to the dollar level after hitting a low of P54:$1 earlier in the year.
“However, these factors could be offset in part by higher electricity rates in Meralco-serviced areas,” the Bangko Sentral noted.
Manila Electric Co.’s per kilowatt-hour (kWh) rate for households consuming 200 kWh monthly was raised by P0.09.
“Moving forward, the BSP will continue to closely monitor evolving price trends and domestic demand condition to help ensure that the inflation target is achieved,” the central bank said.
Rising inflation, which breached the 2.0-4.0 percent target in March and hit a nine-year high of 6.7 percent in September-October, prompted the BSP’s policymaking Monetary Board to raise key interest rates for five consecutive times beginning May.
November’s inflation easing prompted a pause although some observers expect rate hikes to resume next year as fuel taxes will be raised starting January.
Official December inflation data will be announced on January 4.
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