BSP tags fuel price, electricity rate hikes as inflation drivers

AP

A Filipino engineer checks on the rebar links of a construction project in Metro Manila.

MANILA – Higher electricity rates and prices of petroleum products and could have contributed to inflationary pressures this November, but a slightly stronger peso helped ease the pressure on prices, the Bangko Sentral ng Pilipinas said Wednesday.

Inflation is expected to settle within 2.9- to 3.6-percent this month given, largely influenced by higher utility prices, the central bank noted.

“Higher domestic petroleum prices and electricity rates in Meralco-serviced areas could contribute to upward price pressures,” the central bank said in an emailed statement.

Prices of petroleum products were raised in three out of the four weeks of the month, while the Manila Electric Co. (Meralco) imposed a P0.3436 per kilowatt-hour increase in electricity rates.

The BSP noted, however, that downside to inflationary pressures includes a stronger local currency.

This “could be partly offset by the slightly stronger peso for the month,” the BSP said.

“Average inflation is expected to remain with the national government’s target range of 3.0 percent ± 1.0 percentage point for 2017,” it added.

The BSP targets inflation to settle with 2.0 percent to 4.0 percent this year.

The Philippine Statistics Authority (PSA) is scheduled to release the November 2017 inflation report on Dec. 5, 2017. (GMA News)