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February inflation seen to accelerate to 4.1%


The Bangko Sentral ng Pilipinas said inflation in February likely accelerated to as high as 4.1 percent, as price hike in food and energy items was evident during the month. In January, inflation stood at 3.5 percent — the fastest acceleration since August last year. "Inflation is forecast to fall within the range of three percent to 4.1 percent as expected volatilities in food and oil markets could tilt inflation higher this month," BSP Gov. Amando Tetangco Jr. said in a text message. National Statistics Office records show that inflation averaged at 3.8 percent last year, well within the forecast range of 3.5-5.5 percent. The Bangko Sentral ng Pilipinas has set the annual inflation to average from 3-5 percent this year. "Full-year inflation for 2011 is still seen to fall within the target range, albeit closer to the higher end of that range," Tetangco said. He said the central bank will remain vigilant against potential sources of price volatility such as the geopolitical events in the Middle East. "The tensions there could impact on commodity prices and growth prospects in the advanced economies." Tetangco maintained that the BSP still has ample space and flexibility in its monetary tool kit to address unforeseen risks and ensure that the inflation outlook remains manageable. The central bank keeps this stance as various economists have said the BSP may have fallen behind the curve and missed the chance to act preemptively against inflation. The policy-setting Monetary Board has placed the overnight borrowing and lending rates at 4 and 6 percent, respectively, since July 2009. — JE, GMA News

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