THE LATEST Bangko Sentral ng Pilipinas (BSP) poll among bank economists showed an average inflation forecast for this year of 1.9 percent, lower than the projection a quarter ago, in light of cheap oil, low power rates and slow global growth.
The mean inflation forecast for 2016 based on the BSP’s survey of private sector economists conducted in March was not only below the average of 2.5 percent during last December’s poll but also lower than the BSP’s target inflation range of 2-4 percent.
“Analysts attributed their lower inflation expectations to continued low global oil prices, slower global economic growth and lower domestic electricity rates. These are likely to outweigh the upside risks brought by the El Niño phenomenon, increased government expenditures from the upcoming election, pending power rate adjustments, rebound in oil prices, base effects in the consumer price index data, possible occurrence of La Niña in the latter part of 2016 and prospects of rising US interest rates,” the BSP said.