The Bangko Sentral ng Pilipinas (BSP) said Friday it expects inflation to retreat from 4.4 percent in July 2024.
It said in a statement the August inflation would likely settle within a range of 3.2 percent to 4.0 percent, or within the government’s target range of 2 percent to 4 percent for 2024.
The BSP said the lower domestic oil, rice, fish and meat prices, along with the peso appreciation, were expected to mitigate the upward pressures from other commodities.
It said higher electricity rates and rising agricultural commodity prices, driven by unfavorable weather in August, were the primary contributors to inflationary pressures.
Inflation climbed to 4.4 percent in July, but BSP Governor Elli Remolona Jr. said at the last monetary policy meeting that this would taper off in the coming months.
Remolona said the balance of risks to the inflation outlook leaned toward the downside for the rest of 2024 and 2025, led by the lower import tariff on rice.
The Monetary Board said it would continue to take a measured approach in ensuring price stability conducive to balanced and sustainable growth of the economy and employment.
The MB, the policy-making body of the BSP, cut by 25 basis points the overnight borrowing rate for the first time in two years on Aug. 15, 2024 and hinted of another adjustment later this year.
