BSP may adopt 2-4 pct inflation target for 2017

Posted at 06/24/2014 5:18 PM | Updated as of 06/24/2014 5:18 PM

MANILA, Philippines – The Bangko Sentral ng Pilipinas (BSP) may adopt the same inflation target from 2015 to 2017 of 2 to 4 percent, BSP deputy governor Diwa Guinigundo said.

The 2 to 4 percent inflation target for 2017, which the BSP has yet to officially adopt, reflects a slower acceleration compared to the 3 to 5 percent target this year.

The central bank has forecast the inflation rate to average 4.4 percent in 2014 and 3.7 percent in 2015.

As of May this year, inflation rate has averaged 4.1 percent after it reached a 30-month high due to increases in food prices and utility rates.

The Monetary Board said in its June 19 policy meeting that “the balance of risks to the inflation outlook remains tilted toward the upside,” but noted that the rate is projected to remain within target despite being closer to the upper end of the range.

Higher food prices and power rate increases contribute to risks to inflation.

The BSP earlier kept its policy rate at a record low of 3.5 percent but raised the rate on its short-term special deposit account facility.