Bangko Sentral ng Pilipinas (BSP) Governor Amando Tetangco Jr. on Tuesday said pressures on prices are easing and that headline inflation rate for December will be within 2.4 percent to 3.2 percent.
In November, headline inflation dropped to a year-on-year rate of 3.7 percent from 4.3 percent in October.
While inflation rate is seen to be more manageable in the coming months, Tetangco said the BSP will continue to monitor trends and adopt policies to ensure prices are stable to support a balanced and sustainable economic growth.
The central bank earlier trimmed its inflation forecast for full-year 2014 to 4.2 percent from the previous forecast of 4.4 percent. For 2015, the forecast was also adjusted downward to 3 percent from 3.7 percent. For 2016, it was adjusted to 2.6 percent from the previous 2.8 percent.
Tetangco in a text message to reporters said lower rice prices, jeepney fares, power rates and the continued rollback in fuel prices will continue to pull down the country’s headline inflation rate (basic inflation rate).
Based on its assessment that the inflation environment continues to be more manageable, Monetary Board of the BSP at its December 11 meeting decided to keep its existing rates for overnight borrowing and lending, as well as the SDA and the reserve requirement ratio (RRR) for banks.
The rate for the overnight borrowing, or reverse repurchase facility stayed at 4.0 percent and the rate for overnight lending, or repurchase facility remains at 6.0 percent. The interest rate for SDA was also left unchanged at 2.50 percent, as well as 21-percent RRR for banks.