The damage from Typhoon Santi could have triggered a higher inflation rate this month, according to the Bangko Sentral ng Pilipinas (BSP).
In a text message, BSP Governor Amando Tetangco Jr. said that inflation in October could settle within a range of 2.8 percent to 3.6 percent.
He said food prices particularly rice and fresh vegetables were higher because of the damage caused by the typhoon.
Data from the Department of Agriculture showed that damage to agriculture in Central Luzon, particularly to rice in Aurora and Nueva Ecija provinces, was about P2.9 billion.
Despite this, the central bank’s inflation forecast for the month was within the target for 2013, Tetangco said.
“Going forward, the BSP will continue to closely monitor the factors that affect movements in prices, in line with the BSP’s primary mandate of delivering price stability conducive to a balanced and sustainable economic growth,” he said.
In the latest Monetary Board meeting, the BSP said that inflation forecasts remain within its predicted range of 3-percent to 5-percent for 2013 to 2014, and 2-percent to 4-percent for 2015.
The central bank also retained its inflation forecast for 2013 at 3 percent.
However, there were slight changes in the monetary authority’s inflation forecast for the next two years.
Inflation for 2014 is seen at 3.9 percent, down from the previous estimate of 4 percent. For 2015, the BSP’s inflation forecast is 3.4 percent, lower than the 3.5 percent previous estimate.
Benign inflation also prompted the Monetary Board to keep the BSP’s key monetary policy rates at bay.
Reverse repurchase rate remained at 3.5 percent, while the repurchase rate was kept at 5.5 percent.
The reserve requirement ratios were kept steady as well, while special deposit account rate was retained at 2 percent.
MAYVELIN U. CARABALLO