MANILA—Lower prices of oil and cut in electricity rates are expected to counter the effect of higher rice prices and bring the May 2017 inflation level between 2.9-3.7 percent.
The forecast range, announced by Bangko Sentral ng Pilipinas (BSP) Governor Amando M. Tetangco Jr. through text messages to reporters Friday, is lower than the three to 3.8 percent the central bank had for the April inflation rate.
Last April, rate of price increases was flat at 3.4 percent but is more than twice the 1.1 percent same month last year.
In the first four months of the year, inflation averaged at 3.2 percent, slightly higher than the mid-point of the central bank’s two to four percent target range for this year until 2020.
Inflation averaged at 3.2 percent in the first quarter this year.
Monetary officials expect inflation to sustain its rise only until the third quarter of this year, with this year’s average seen at 3.4 percent.
“Moving forward, the BSP will continue to monitor evolving price conditions in line with the BSP’s commitment to price stability conducive to balanced and sustained economic growth,” Tetangco said.