THE Bangko Sentral ng Pilipinas (BSP) is anticipating a wide range for December inflation, projecting it could either dip to 1.2% or rise to 2.0%, influenced by weather disruptions and increased consumer spending during the holiday season.
The central bank indicated that inflation could fluctuate from November’s 1.5% due to a combination of factors. Higher prices for essential food items, resulting from recent severe weather events, and a surge in demand during the holidays are expected to exert upward pressure on prices. Additionally, rising fuel and liquefied petroleum gas (LPG) costs may contribute to inflationary pressures.
In November, the Philippines experienced the impact of typhoons Tino (Kalmaegi) and Uwan (Fung-wong), which caused significant disruptions to agricultural production and supply chains.
Fuel retailers implemented another round of price increases on Monday, with diesel and kerosene prices climbing by P0.60 per liter each, while gasoline prices remained stable. This brings the year-to-date net adjustments to an increase of P20.50 per liter for gasoline, P20.85 per liter for diesel, and P5.55 per liter for kerosene.
“These pressures could be partly offset by lower electricity prices in Meralco service areas and declining kerosene and diesel prices,” the BSP noted. The Manila Electric Company previously announced a reduction of 35.57 centavos per kilowatt-hour for December, which would result in a decrease of more than P71 in the monthly bill for a typical household consuming 200 kilowatt-hours.
During its most recent meeting on December 11, the BSP’s Monetary Board revised its inflation forecast for this year to an average of 1.6%, slightly lower than the previous estimate of 1.7%. The BSP projects inflation to accelerate to 3.2% next year before moderating to 3.0% in 2027.
“The BSP will continue to monitor domestic and international developments affecting the outlook for inflation and growth in line with its data-dependent approach to monetary policy,” the central bank affirmed.
