Inflation in the Philippines may have accelerated to between 3.7 to 4.5 percent in May, potentially breaching the central bank’s target for the first time in six months, driven by higher electricity rates and a weaker peso, according to the Bangko Sentral ng Pilipinas (BSP).
If inflation reaches the upper end of the forecast, it will be the highest since October. The primary sources of inflationary pressure were increases in electricity rates and vegetable prices, alongside the recent peso depreciation.
Despite these pressures, lower prices for rice, fish, fruits, domestic fuel, and LPG provided some relief.
BSP Governor Eli Remolona Jr. indicated that while inflation might exceed the target in the second quarter, it is expected to stabilize within the target range by the third quarter, with potential interest rate cuts as early as August depending on the inflation trajectory.
Source: PhilNews24 | June 1, 2024
