MANILA – Inflation accelerated for the fifth straight month in March, settling within forecasts, due to higher food, tobacco, and utility costs, government data released Wednesday showed.
The consumer price index rose 3.4 percent in March, the highest since November 2014. It matched the prediction of economists polled by Reuters.
The Bangko Sentral ng Pilipinas has set a 2 to 4 percent inflation target this year.
“The fact that it is in line provides us comfort. I don’t think there’s going to be a change in the stance,” BPI Securities research head Haj Narvaez said, referring to monetary policy.
Inflation could average 3.8 percent this year and the BSP could raise interest rates up to two times, “towards the second half,” Narvaez told ANC’s “Market Edge with Cathy Yang.”
Policymakers expect this year and next year's inflation to average 3.4 percent and 3 percent, respectively, lower than previously thought, on falling oil prices and global economic uncertainties.
The central bank kept its benchmark interest rate steady at 3 percent last month, with inflation on course to fall within its 2-4 percent target this year.
Tame inflation and strong growth has allowed the BSP to rates steady since it raised its main rate by 25 basis points in September 2014. -- with a report from Reuters