BSP sees March inflation settling at 2-2.8%

THE country’s headline inflation rate could have slowed to as low as 2 percent or picked up to as high as 2.8 percent in March, the Bangko Sentral ng Pilipinas (BSP) said on Tuesday.

The range estimated by the central bank’s Department of Economic Research compares with February’s 2.6 percent, but is lower than the 3.3 percent posted in March last year.

The Philippine Statistics Authority (PSA) will release official March inflation data on April 7.

“The sharp decline in the prices of petroleum products due to the significant fall in global crude oil prices contributed to the downward price pressures for the month,” the BSP said in a statement.

According to the Department of Energy, oil companies implemented their per- liter rollbacks by P3 to P3.50 for gasoline and kerosene, and P2 for diesel from March 21 to 24.

“In addition, the prices of selected food products remained broadly stable in March due to adequate supply and favorable weather conditions, along with the price freeze imposed on basic necessities by the Department of Trade and Industry and the Department of Agriculture,” the Bangko Sentral added.

It also said electricity rates in Manila Electric Co. ( Meralco)serviced areas were slightly higher in March.

Meralco’s per kilowatt- hour (kWh) rate for households consuming 200 kWh monthly increased by P0.0278 centavos last month.

“Going forward, the BSP will continue to monitor economic and financial developments, and stands ready to implement appropriate policies in support of its primary mandate of price stability conducive to balanced and sustainable economic growth,” the central bank said.

In a Viber message to reporters on Tuesday, BSP Governor Benjamin Diokno said the central bank “forecasts tamer inflation this year and [the] next.”

The BSP earlier trimmed its baseline average inflation projection to 2.2 percent from 3.0 percent for 2020 and to 2.4 percent from 2.9 percent for 2021. Both fall within the government’s 2 to 4-percent target range.

“The main driver for the downward adjustment is the collapse of world crude oil prices,” he added.

Dubai crude oil price is now at its 18-year low of $22.51 per barrel, down from its recent peak of $85.00 per barrel in 2018, according to the BSP chief.