Central bank expects inflation to peak in third quarter

August 7, 2018

The Bangko Sentral ng Pilipinas (BSP) expects inflation to peak in the third quarter, and is expected to return to the target range of 3 percent, plus-minus 1 percentage point by 2019.

In a statement on Tuesday after the Philippine Statistics Authority reported July inflation at 5.7 percent from June's 5,2 percent, the central bank said "the uptick in prices is driven mainly by supply-side factors, including the impact of higher excise taxes."

The July 5.7 inflation data, added the central bank, "  is consistent with our still elevated inflation outlook for 2018, with likely peak occurring in the third quarter of the year."

The central bank has raised policy rates in the last two months. It's policy-setting body will be  meeting on Thursday to decide if rates will be increased again. DMS