The Bangko Sentral ng Pilipinas (BSP) on Friday forecasted May inflation to settle within the 3.7% to 4.5% range, pointing to pressures from vegetable and power rates weighing on commodity prices.
Headline inflation settled at 3.8% in April, the Philippine Statistics Authority (PSA) said.
"Continued increases in electricity rates and vegetable prices alongside recent peso depreciation are the primary sources of upward price pressures for the month," the BSP said in a statement,
The Manila Electric Company earlier announced that power rates in May increased by P0.4621 per kilowatt hour to P11.4139 per kWh from P10.9518 per kWh in the previous month.
However, the central bank noted that lower prices of rice, fish, and fruits, as well as lower domestic oil and LPG (liquefied petroleum gas) prices, could offset the upside price pressures.
The latest data from the PSA showed that from May 15 to 17, the national average retail price for a kilogram of well-milled rice was P56.52, slightly lower than the P56.98 per kg recorded in the same period in April.
Meanwhile, Oil companies slashed LPG product prices by more than PHP1 per kilogram.
"Going forward, the BSP will continue to monitor developments affecting the outlook for inflation and growth in line with its data-dependent approach to monetary policy decision-making," said the BSP.
The PSA will release the May 2024 headline inflation data on June 5.
Meanwhile, the Philippine peso closed at 58.635 to a dollar on Thursday, its weakest performance since the 58.80 finish on November 3, 2022.
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