I LATION could have slowed in June due to lower food and fuel prices, the Bangko Sentral ng Pilipinas (BSP) said on Tuesday.
Consumer price growth was forecast to have hit 6.0-7.0 percent, above the central bank’s 2.0- to 4.0-percent target.
Inflation at the top end, if realized, will be higher than the 6.8 percent seen in May. A result below that will mark a second straight monthly slowdown since April’s over three-year high of 7.2 percent.
Data for June will be released by the Philippine Statistics Authority on July 7.
“The decline of domestic oil prices and the lower prices of major food items, such as rice and meat may temper inflation for the month,” the central bank said in a statement.
“However, higher electricity rates and vegetable prices could partly offset these downward price pressures,” it added.
The BSP expects inflation to remain above target until next year. It recently raised the projection for 2026 to 6.4 percent from 6.3 percent and that for next year to 4.5 percent from 4.3 percent.
Key interest rates have been raised twice so far this year in response to rising inflation, with the policy rate now at 4.75 percent.
“The BSP will remain vigilant and guided by incoming data, particularly on inflation and growth prospects,” the central bank said.
“It will continue to monitor recent developments in the Middle East for their implications for inflation and economic activity,” it added.
The policymaking Monetary Board, BSP Governor Eli Remolona Jr. said last month, “can always have an off-cycle meeting.”
“We can do 50 basis points if necessary,” he added.
The next policy meeting will be held on August 27.
