The increase in the price of consumer goods is likely to remain tame in April, despite the hike in oil prices and power rates, the Bangko Sentral ng Pilipinas (BSP) said on Friday.
BSP Governor Amando M. Tetangco Jr. said in a text message to reporters that inflation in April will likely settle between 1.9 percent and 2.8 percent.
“Price pressures may come from the upward adjustments in local pump prices of oil and power rates. However, higher energy prices may be offset by the continuous decline in rice prices,” Tetangco said.
Should inflation hit the low end of the BSP’s forecast, the rate will be the lowest since August 2009 and will put the four-month average of the country’s inflation at 2.3 percent. In January to March, inflation averaged 2.5 percent.
The projected inflation this month is well within the government’s target of 2 percent to 4 percent for 2015.
Tetangco also said the BSP remains mindful of developments in the domestic and global fronts, and that it is ready to adopt appropriate policies to ensure that economic targets are met.
“Moving forward, the BSP will continue to monitor emerging prices trends and adopt appropriate policies in line with its commitment to the inflation target and in support of the country’s growth objectives,” he said.
Economists said the Monetary Board, which will meet in May, is expected to retain its current monetary-policy stance.
Earlier, the National Economic and Development Authority (Neda) said high inflation will be kept at bay despite the El Niño weather phenomenon and thin power supply.
“While the current episode of mild El Niño and power woes still pose risks to inflation, the continuing efforts to ensure that appropriate policy actions are implemented are expected to temper inflationary pressures over the near to medium term,” Economic Planning Secretary and Neda Director General Arsenio M. Balisacan said.
The Philippine Statistics Authority is expected to release the April inflation rate in the first week of May.