Inflation, or the rate of change in prices, is forecast to hit as low as 5.3 percent in June on the back of sustained moderation on the price of key food items, according to the Bangko Sentral ng Pilipinas (BSP).
In no way also should inflation push higher than 6.1 percent in June, which was where headline inflation stood lower than most economists forecasted during the period, the BSP also said.
“Higher prices of key food items, such as rice, vegetables, and fish, along with the increase of domestic oil prices and electricity rates as well as the depreciation of the peso are the primary sources of upward price pressures in June.
But “the lower prices of meat and fruits as well as the rollback in LPG prices could contribute to downward price pressures during the month,” the BSP said.
The May reading on inflation was the lowest it had been since June last year and has steadily fallen from its peak of 8.7 percent posted only in January this year.
The expectation is for inflation to moderate even more in June as food prices, while remaining elevated, have since increased the least in recent price surveys. The food component accounts for around half of the consumer price index or CPI that the government surveys each month.
