BSP to evaluate ‘potential drivers of future inflation’

MANILA — The Bangko Sentral ng Pilipinas on Wednesday said it will look into “a very rich and broad range of information” at its policy meeting next week, including possible inflation drivers.

“It’s a fairly complex environment that we need to navigate,” Governor Nestor Espenilla was quoted as saying in media reports.

Inflation spiked 4.6 percent in May, outpacing the 4.5 percent increase in April but lower than market estimates of 4.9 percent.

The May inflation rate was the highest since November 2011 and was above the central bank’s 2-4 percent target range. Year-to-date, inflation averaged 4.1 percent.

For the first time in nearly four years, the BSP last month lifted key rates to tame rising consumer prices.

But Espenilla recently said inflation outlook “continues to be a concern and requires close attention" while some economists say the BSP will likely undertake further policy action this year as inflation heats up.

Meanwhile, the central bank chief’s statement came as the Philippine peso on Wednesday hit a fresh 12-year low amid expectations that the US Federal Reserve will raise its benchmark rate and implement additional rate hikes this year.

“Recent developments on inflation and economic activity are key inputs but these are certainly not the only consideration,” Espenilla said. .

(Philstar.com)