Despite the continued downward trend in consumer prices as shown by the latest official data on inflation at below 1 percent, the Bangko Sentral ng Pilipinas (BSP) said it believes inflation this year will average within its target range of 2 percent to 4 percent.
“We expect some monthly outturns below our target range, but we remain confident that the full-year averages over the policy horizon will be kept within the target range, albeit close to the lower end,” BSP Governor Amando Tetangco Jr. said in a text message to reporters following the release of the official July inflation rate.
Official data from the Philippine Statistics Authority (PSA) showed growth in consumer prices hit its slowest pace in 20 years at 0.8 percent in July, decelerating from 1.2 percent in June and 4.9 percent in July last year.
Tetangco stressed that domestic liquidity remains ample and credit growth in the country continues at a steady pace.
The BSP governor added that the central bank will monitor development, especially those from external sources that may raise volatility in financial markets or impact inflation expectations.
“We will see at our meeting next week if there is need for any adjustments to our stance of policy,” he said, referring to the August 13 policy meeting of the Monetary Board.