BSP eyes January inflation at 3.7%

MANILA – The country’s monetary officials forecast the rate of price increases in January 2021 to stay between 3.3-4.1 percent, with the midpoint at 3.7 percent, an uptick from the previous month’s level.

In a Viber message to journalists Friday, Bangko Sentral ng Pilipinas (BSP) Governor Benjamin Diokno said increases in the prices of fuel, meat, power rates in areas being serviced by the Manila Electric Company (Meralco), and excise taxes on alcoholic beverages and tobacco “contributed to upward price pressures during the month.”

He, however, said these factors “could be partly offset by stable rice prices, lower prices (of) selected fish and vegetables as well as the continued appreciation of the peso.”

“Going forward, the BSP will remain watchful of economic and financial developments to ensure the delivery of its primary mandate of price stability conducive to a balanced and sustainable economic growth,” he added.

Inflation rate last December rose for the third consecutive month to 3.5 percent from month-ago’s 3.3 percent, which authorities point to as the impact of the weather disturbances that hit the country since November.

However, average inflation last year stood at 2.6 percent, within the government’s 2-4 percent target band until 2024.

The BSP’s average inflation forecast for this year is 3.2 percent.