July price spikes? No worries, says BSP, as it predicts lower inflation for rest of 2024

The Bangko Sentral ng Pilipinas (BSP) said on Tuesday that it expects the country’s inflation rate to ease for the rest of the year and into next year, after the government released official figures showing that prices of goods and services spiked in July.

In a statement, the BSP noted that the July 2024 inflation rate of 4.4%, fell within their forecast range of 4.0 to 4.8%.

While inflation rose due to higher electricity rates and base effects, the central bank said expects it to decline from this month onward.

The expected shift in inflation risks to the downside is attributed to the lower import tariff on rice under President Marcos’ Executive Order 62.

However, potential price increases in food items, transport, and electricity pose upward risks, the monetary regulator cautioned.

“The Monetary Board will consider the latest inflation outturn as well as the second quarter 2024 national accounts in its assessment of the inflation outlook and the balance of risks in the August 2024 monetary policy meeting,” the agency said.

“Moving forward, the BSP will ensure that monetary policy settings remain in line with its primary mandate to safeguard price stability conducive to sustainable economic growth,” it added.