BSP Advises the Public to Worry Less Amid the Holiday Price Hike
The Bangko Sentral ng Pilipinas (BSP) once again stated that the price hike is not a monetary policy and the price surge will most probably be on the supply side.
BSP Governor Benjamin Diokno stated, “The balance of risks to the inflation outlook remains on the upside for the remaining months of 2021, but continues to be broadly balanced for 2022 and 2023.”
He added, “The private sector’s inflation expectation is also consistent with inflation reverting back to the target by 2022.”
The Philippine Statistics Authority (PSA) reported that the inflation rate fell to 4.6% from the previous 4.9% last October 2021 that is within the BSP’s forecast range of 4.5 to 5.3%.
BSP looks forward to an inflation average above the target scale of 2 to 4% this year. However, it foresees to fall to the center point of the equivalent target range over the course of the next two years.
Diokno expressed, “[BSP] remains of the view that supply-side price pressures are best addressed by timely non-monetary policy interventions that could ease domestic supply constraints.”
Diokno stated that the Philippine Government is ensuing direct measures to improve the distribution of key goods such as pork, rice, and fish at the moment.
The newly approved ₱1 billion in petroleum aid to Public Utility Vehicle (PUV) operators including the growing capacity due to more relaxed COVID-19 regulations can also assist the transport sector and can help out with regards to stopping oil price surge.
According to Diokno, “Looking ahead, BSP stands ready to maintain its accommodative monetary policy stance for as long as necessary to support the economy’s sustained recovery to the extent that the inflation outlook would allow.”
In addition, he also stated, “BSP is also reviewing its assessment of the price environment ahead of November 18 monetary policy meeting.”