Bangko Sentral ng Pilipinas Deputy Governor Diwa Guinigundo said Thursday inflation is expected to remain stable in the coming months, in the absence of upward price pressures.
“Right now we don’t see anything [that could push inflation higher] because the probability for a neutral weather condition is now higher,” Guinigundo told reporters at the sidelines of an event at Conrad Manila in Pasay City.
“So that means better conditions for the rest of the year. Normally, there are floods or drought [in the latter part of the year] and it impacts the prices of commodities, particularly agricultural products. But we don’t expect these to happen,” Guinigundo said.
He said the additional adjustments in jeepney fares outside Metro Manila was already factored in by Bangko Sentral’s Monetary Board when it revised downward the inflation forecast this year.
Guinigundo said even the impact of the first package of the tax reform program next year would be manageable.
Guinigundo said that on food prices, the National Food Security Council, where the BSP Governor sits as one of its members, already approved the importation of additional 805,000 metric tons of rice under the 2016 minimum access volume.
The government earlier said the move would help ensure adequate supply and stable prices within the reach of low-income families.
The Monetary Board kept the benchmark interest rates steady last week, on lower inflation and robust domestic economic growth.
Interest rates were kept at 3.5 percent for overnight lending, 3 percent for overnight borrowing and 2.5 percent for deposit facilities.
The board reduced the average inflation forecast this year to 3.1 percent from 3.4 percent. Inflation averaged 3.2 percent in the first five months.