Higher rice prices likely pushed inflation up by 2.9-3.7 percent in May, Bangko Sentral ng Pilipinas Governor Amando M. Tetangco Jr. said Friday.
“The lower prices of domestic oil as well as the downward adjustment in electricity rates could exert downside influence on inflation, which could be partly offset by higher rice prices,” Tetangco said in a text message to reporters.
The latest Philippine Statistics Authority (PSA) data showed that as of the second week of May, the average retail price of well milled rice rose 0.27 percent to P41.69 per kilogram from P41.58 per kilo in the previous week, also up 1.06 percent year-on-year.
The average retail price of regular milled rice, meanwhile, increased 0.16 percent from a week ago and 1.39 percent a year ago to P37.38 a kilo, PSA data showed.
Economic managers have been pushing for private sector-led rice importation to ensure stable supply and temper the rising prices of the Filipino staple food.
As of end-April, headline inflation averaged 3.2 percent, still within the BSP’s target range of 2 to 4 percent for 2017.
To recall, the average inflation rates in 2015 and 2016 were both below 2 percent.
BSP Deputy Governor Diwa C. Guinigundo early this month said they expect the rate of increase in prices of basic goods to peak to 3.7-3.8 percent in August on base effects, before easing towards yearend.
On May 11, the Monetary Board—the BSP’s highest policymaking body, kept key policy rates steady amid still manageable inflation expectations.
The Monetary Board also maintained its inflation forecasts of 3.4 percent for 2017 and 3 percent for 2018.