Bangko Sentral sees March inflation staying 'low and manageable'

The inflation rate in March is expected to settle between 2.8 percent and 3.7 percent, taking into account higher electricity rates for the month, the Bangko Sentral ng Pilipinas said Monday. "Inflation continues to be low and favorable, Bangko Sentral Governor Amando Tetangco Jr. said in a text message to reporters. “Results of the BSP's latest forecasting exercises suggest that inflation for March could fall between 2.8 to 3.7 percent.”   "This forecast range incorporates the impact of the upward adjustment in electricity rates due to the increase in stranded contracted costs during the month. It also takes into account lower domestic oil prices as well as price reductions in selected food items," Tetangco added, noting the food items include in-season fruits, fresh vegetables and sugar. The average inflation this year and next year is also expected to settle at the lower end of government's target range of 3 to 5 percent, as inflation pressures remain manageable and inflation expectations well-anchored, the central bank chief noted. "Moving forward, the BSP will continue to monitor price and demand developments to ensure sustained support to the BSP's primary mandate of delivering price stability conducive to a balanced and sustainable economic growth," he said. During the Monetary Board meeting on March 14, the central bank raised its inflation forecast this year to 3.3 percent from the 3 percent due to the pending domestic power rate adjustments and a potentially stronger domestic liquidity growth as foreign funds continue to enter the Philippine economy. For 2014, the inflation rate was also adjusted to 3.3 percent from 3.2 percent. — VS, GMA News