By means of Luisa Maria Jacinta C. Jocson, Reporter
Headline inflation may have accelerated in November but still remained within the target range of 2-4%, the Bangko Sentral ng Pilipinas (BSP) said.
The central bank’s monthly forecast showed inflation likely to remain in a range of 2.2% to 3% in November, slower than 4.1% in the same month a year ago.
However, the top end of the forecast would be faster than the 2.3% recorded in October.
The Philippine Statistics Authority (PSA) is expected to release November inflation data on December 5.
“Rising prices of vegetables, fish and meat due to adverse weather conditions, higher electricity tariffs and petroleum prices, and the depreciation of the peso are the main sources of upward price pressure this month,” the BSP said in a statement.
The Philippines was hit by several storms this month. The latest data from the Ministry of Agriculture shows that agricultural damage caused by tropical cyclones Nika, Ofel and Pepito amounted to 785.68 million euros.
In November, adjustments to pump prices amounted to a net increase of P1.7 per liter for gasoline, P3.2 per liter for diesel and P1.6 per liter for kerosene.
Manila Electric Co. (Meralco) also increased the overall rate by P0.4274 per kilowatt hour (kWh) to P11.8569 per kWh in November, from P11.4295 per kWh in October.
The peso fell to the level of P59 per dollar twice so far this month, hitting record lows on November 21 and 26.
The BSP previously attributed this to the stronger dollar amid rising geopolitical tensions.
On the other hand, risks to the inflation outlook are believed to be offset by lower rice prices, the central bank added.
National Economic and Development Authority (NEDA) Secretary Arsenio M. Balisacan said Friday that inflation is expected to remain “comfortably” within the target range of 2-4%.
“We don’t think this figure will exceed our target of 2-4% in November,” he said, although he noted that if prices were to rise it would be “marginal”.
Mr. Balisacan also noted that the BSP easing cycle will support the economy.
“We expect the BSP’s decision to cut the policy rate by a total of 50 basis points and reduce reserve requirements to boost liquidity and thus boost private spending growth,” he said.
“Particularly in the areas of expensive consumer goods and investments in capital-intensive infrastructure in the coming quarters, which we see as another important driver of economic growth.”
The BSP said it “will continue to take a measured approach in ensuring price stability conducive to balanced and sustainable growth of the economy and employment.”
Since August, the central bank has cut financing costs by 50 basis points, bringing the policy rate to 6%.