Inflation may have nudged higher in October as food prices and a softer peso put pressure on household budgets, according to the Bangko Sentral ng Pilipinas (BSP). The central bank on Thursday projected inflation to land between 1.4 percent and 2.2 percent for the month.
If the result comes in at 2.0 percent or higher, it would mark the first time in seven months that inflation breaches the lower end of the BSP’s 2 to 4 percent target band. September inflation was 1.7 percent.
The Philippine Statistics Authority is set to release the official data on November 5.
The BSP said rising costs of rice, fish, vegetables, and electricity, along with peso depreciation, likely drove prices up in October. These pressures, however, may have been tempered by cheaper oil, meat, and fruits.
The central bank stressed it would continue to track global and domestic conditions, noting its policy stance remains guided by data.
BSP Deputy Governor Zeno Abenoja earlier cautioned that inflation could touch the 2 percent level in the coming months as weather-related issues disrupt supply. Still, he said price pressures were expected to stay manageable and inflation would likely remain “mostly below 2 percent.”
Earlier this month, the Monetary Board cut policy rates again by 25 basis points amid a softer growth outlook and what it described as benign inflation conditions. The benchmark rate now stands at 4.75 percent.
The board will meet once more before year end, in December, with three months of fresh inflation data in hand. Analysts are watching for a possible additional rate cut to support economic activity.
