MANILA - The Bangko Sentral ng Pilipinas (BSP) said on Thursday it has set an average inflation goal of 3% to 5% in 2011, slightly easing from the previous year's target, with the outlook for inflation still favourable.

"The outlook of relatively stable inflation over the policy horizon reflects expectations of economic activity gradually normalizing, inflation expectations remaining well-anchored, and base effects easing from previous years," the BSP said in a statement.

"The 2011 inflation target is lower than the 2010 target... consistent with the desired disinflation path over the medium term," it added.

The government is targetting average inflation of 2.5% to 4.5% this year and 3.5% to 5.5% next year.