Supply-side issues add pressure to the spike in consumer prices as the Bangko Sentral ng Pilipinas (BSP) sees inflation accelerate beyond the government’s 2 to 4 percent target in September.
“(The) BSP projects September 2021 inflation to settle within the 4.8 to 5.6 percent range,” BSP Governor Benjamin Diokno said during a virtual press conference on Thursday.
“Upward adjustments in domestic oil prices will drive inflation, electricity rates, suggested retail prices of necessities and prime commodities,” he added.
In addition, the BSP chief recognized the higher cost of selected fruits and vegetables and rice could contribute to the faster inflation in September.
Nevertheless, the decline in meat prices and the slight strengthening of the peso will partially offset the higher inflation, Diokno said.
“The BSP will continue to monitor emerging price developments to help ensure that its primary mandate of price stability conducive to balanced and sustainable economic growth is achieved,” he said.