Inflation for the month of September may hit a high of 5.6 percent due to higher oil prices and electricity rates, according to the central bank.
Bangko Sentral ng Pilipinas (BSP) Governor Benjamin E. Diokno said Thursday, Sept. 30, that inflation will likely settle within its forecast range of 4.8 percent to 5.6 percent for September. The inflation rate increased to 4.9 percent in July from four percent in June, bringing the seven-month average to 4.4 percent.
“Inflation will be driven by upward adjustments in domestic oil prices, electricity rates, suggested retail prices of basic necessities and prime commodities, and prices of selected fruits and vegetables as well as rice. These could be partially offset by the decline in meat prices along with the slight appreciation of the peso during the month,” said Diokno in an online press briefing.
The BSP has recently revised inflation forecasts higher for 2021 to an average 4.4 percent from the previous (August 12) estimate of 4.1 percent.
For 2022, the new forecast is 3.3 percent from the previous 3.1 percent, and for 2023, it is 3.2 percent from 3.1 percent.
The BSP also said that inflation will continue to be above the target range of two-four percent until October before starting to decelerate below the target by November this year.
Upside risks to the inflation path are bad weather and a prolonged recovery from the African Swine Fever outbreak. The downside risks, in the meantime, comes mainly from the spread of the contagious COVID-19 Delta variant and its impact on global growth and domestic demand.
For the remaining months of 2021, risks are mostly tilted to the upside while for 2022 and 2023, the risks remain broadly balanced, according to the BSP.