BSP expects October inflation rate to breach 2%

The Bangko Sentral ng Pilipinas (BSP) is expecting the country’s inflation rate to breach 2% in October due to higher food and electricity costs as well as a weak peso. 

In its forecast released Thursday, the BSP said it projected this month’s inflation print—the rate of increase in the prices of goods and services—to settle within the range of 1.4% to 2.2%. 

“Upward price pressures for the month may stem from higher prices of rice, fish, vegetables, and electricity, as well as the depreciation of the peso,” the BSP said.

Manila Electric Company raised its household electricity rate this month by 23.31 centavos per kilowatt-hour, bringing its overall rate to P13.3182 per kWh. 

On Tuesday, the Philippine peso hit another all-time low of P59.13 against the US dollar amid the flood control corruption controversy. 

The upper end of the BSP's October forecast is faster than September’s inflation rate, which accelerated to 1.7% from 1.5% in August on the back of higher transportation and food costs.

“Going forward, the BSP will continue to monitor evolving domestic and international developments affecting the outlook for inflation and growth in line with its data-dependent approach to monetary policy formulation,” the central bank said. — VBL, GMA Integrated News