MANILA – The Bangko Sentral ng Pilipinas is confident that inflation this year will remain within the three to five percent goal despite a faster rate of three percent in April 2012 from the previous month’s 2.6 percent.
The National Statistics Office traced the rise in the inflation rate to the higher increases in all commodity groups. Year-ago inflation rate is higher at 4.7 percent.
Although at the highest end of the central bank’s inflation forecast of 2.1 to three percent for April 2012, the actual inflation rate in the fourth month this year “still points to a within-target full year average,” BSP Governor Amando Tetangco Jr. said in a text message to reporters Friday.
BSP forecasts inflation to average at 3.1 percent this year and slightly increase to 3.3 percent in 2013. In the first four months this year, inflation has averaged to three percent.
Tetangco said monetary officials “remain watchful of the risks to inflation, particularly volatility in international prices of oil and other commodities.”
“We are also watching for any changes in market activities to see how our past actions are working their way thru the economy,” he said.
“Should it be necessary, we would make adjustments to policy stance to ensure our inflation target range is protected,” he said.
Central bank’s policy-making Monetary Board slashed by a total of 50 basis points the BSP’s policy rates in January and March this year and maintained this during the Board’s policy meeting last April to check on the impact of the cuts.
To date, BSP’s overnight borrowing rate is at record-low of four percent and the overnight lending rate is at six percent.
BSP Deputy Governor Diwa Guinigundo told reporters that a change in the average inflation forecast for this year is possible in the next four weeks after the jump in last April’s inflation rate.
He declined to give figures but hinted the possibility that the forecast would be upwards, given the faster rate of price increases last April.*PNA