An official of the Department of Finance (DOF) forecast inflation to decelerate to as much as 1.2 percent this year if monthly inflation expands by 0.3 percentage points until the rest of the year.
In an economic bulletin, Finance Undersecretary Gil Beltran noted that month-on-month inflation rose by 0.25 percent last July.
Data from the Philippine Statistics Authority (PSA) show that rate of price increases expanded by 2.4 percent year-on-year last July from the previous month’s 2.7 percent.
Year-ago inflation rate is 5.7 percent while year-to-date inflation stood at 3.3 percent, within the government’s 2 to 4 percent target band.
Core inflation, which excludes volatile food and oil items, rose 3.2 percent from month-ago’s 3.3 percent, resulting to a 3.6 percent average. Year-ago figure is 4.5 percent.
Beltran said big drop on food inflation caused the slower inflation rate last July, a turn-around from last year’s inflation environment when food inflation resulted to big jumps in inflation rate, which saw its peak in September to October at 6.7 percent.
He said the latest inflation outturn saw a within-target inflation outturn.
“If month-on-month price increase is at most 0.3-percentage point for the rest of the year, year-on-year inflation rate will continue its downtrend to low 1.2 percent before picking up to 1.7 percent in November,” he added.
During the rate-setting meet of the Bangko Sentral ng Pilipinas’ (BSP) policy-making Monetary Board (MB) last August 8, the Board slashed the central bank’s average inflation forecast for this year from 2.7 percent last June to 2.6 percent.
For 2020, the average inflation forecast was cut from 3 percent to 2.9 percent. The 2021 forecast was set at 2.9 percent. (PNA)