HEADLINE INFLATION likely settled inside a variety of 1.7% to 2.5% in March, the Bangko Sentral ng Pilipinas (BSP) said on Monday.
If realized, the BSP’s forecast can be slower than the three.7% inflation print in March 2024.
On the upper end of the BSP forecast, inflation likely accelerated from 2.1% in February.
The low end of the forecast showed inflation could have slowed below 2% for the primary time for the reason that 1.9% print in September 2024. It could also mark the slowest inflation since 1.6% in May 2020.
A BusinessWorld poll of 18 analysts conducted last week yielded a median estimate of two% for the March consumer price index.
March inflation data will probably be released on April 4.
“Upward price pressures for the month emanate from higher electricity rates and better prices for fish and meat,” the BSP said in an announcement.
In March, Manila Electric Co. (Meralco) raised the general rate by P0.2639 per kilowatt-hour (kWh) to P12.2901 per kWh from P12.0262 per kWh in February.
The Philippine Statistics Authority said the value of a kilo of round scad (galunggong) averaged P235.26 in early March, barely higher than the P226.43 within the previous month. The value of fresh pork belly (liempo) rose to P384.08 per kilo in early March from P375.02 a month earlier.
Nevertheless, the BSP noted there was a drop in prices of rice and vegetables in March.
“Nonetheless, these are expected to be offset by lower prices of rice, fruits, and vegetables, owing to favorable domestic supply conditions in addition to the peso appreciation,” it said.
Rice prices have been on a downtrend on account of government interventions and lower global prices. In February, rice inflation decreased to 4.9% from the two.3% drop in January.
The federal government had slashed tariffs on rice imports to fifteen% starting July 2024. The Department of Agriculture (DA) declared a food security emergency on rice, which authorized the National Food Authority to release buffer stocks at subsidized prices.
Starting March 1, the DA also further lowered the utmost suggested retail price of 5% broken imported rice to P49 per kilo from P52 per kilo previously. The MRSP was further reduced to P45 per kilo starting March 31.
“Going forward, the Monetary Board will proceed to take a measured approach in ensuring price stability conducive to balanced and sustainable growth of the economy and employment,” the BSP said.
The BSP’s baseline forecasts for inflation are at 3.5% for 2025 to 2026. Accounting for risks, inflation could reach 3.7% in 2026.
The BSP last month opted to maintain its key rate regular at 5.75% amid global trade uncertainties.
Nevertheless, BSP Governor Eli M. Remolona, Jr. has said they’re still on an easing cycle, signaling the opportunity of a 25-basis-point cut on the Monetary Board’s policy-setting meeting on April 10. — A.R.A. Inosante
