The Bangko Sentral ng Pilipinas (BSP) has maintained a largely unchanged inflation outlook in its July 2025 price survey, projecting the headline rate to remain within a modest range of 0.5 percent to 1.3 percent, reflecting subdued price pressures and a cautious monetary stance.
According to the BSP, upward pressures this month are expected from higher meat and vegetable prices, driven partly by unfavorable weather, alongside increased electricity rates, elevated fuel costs, and the depreciating peso. These are expected to be partially offset by the continued decline in rice prices, providing some relief to the inflation basket.
The latest guidance comes on the heels of official data showing that June 2025 inflation edged up slightly to 1.4 percent, from 1.3 percent in May, a five-year low. The rise was mainly due to faster increases in housing and utilities (3.2 percent), education (5.4 percent), and restaurant services (2.1 percent), while deflation in transport moderated. Core inflation was steady at 2.2 percent for the third straight month, reflecting stable underlying price trends.
The BSP reiterated its data-dependent policy approach, indicating that any future policy rate decisions will be based on evolving inflation and growth dynamics. The continued low inflation environment suggests the central bank may retain its policy settings in the near term unless inflation risks escalate.
