MANILA (UPDATE) - Inflation for the month of April further quickened as the economic recovery gained pace, the state statistics bureau said Thursday.
The consumer price index rose 4.9 percent, faster than the 4 percent rate in March, the Philippine Statistics Authority said.
It rose to its highest level since December 2018 which was at 5.2 percent.
This breached the government target of 2 to 4 percent but remained within the Bangko Sentral ng Pilipinas' forecast of 4.2 percent to 5 percent.
Higher prices for select food items and non-alcoholic beverages contributed to the increase as well as transport due to the hike in gasoline and diesel price, National Statistician Dennis Mapa said.
"The inflation outturn is consistent with the BSP’s assessment that inflation will remain elevated over the near term due to the continued volatility in global oil and non-oil prices, reflecting largely the continued impact of the conflict in Ukraine on the global commodities market," BSP Governor Benjamin Diokno said in a statement.
Diokno earlier said that inflation could average 4.3 percent this year.
Prices could also remain elevated in the second half of the year due to Russia's invasion of Ukraine and its impact on oil prices and other global commodities," he said.
"Latest assessment also indicates that domestic economic activity has gained stronger traction with the easing of remaining mobility restrictions. However, heightened geopolitical tensions and a resurgence in COVID-19 infections in some countries have also clouded the outlook for global economic growth," Diokno said.
"Supply-chain disruptions could also contribute to inflationary pressures, and thus warrant closer monitoring to enable timely intervention in order to arrest potential second-round effects," he added.
ING Bank Senior Economist Nicholas Mapa said inflation could breach target this year and next year due to the effects of the Russia-Ukraine conflict on commodity prices.
"We’re going to have to deal with inflation this year, as well as next year largely because the food component is the most important subsector of the food prices," Mapa said.
The National Economic and Development Authority said it is accelerating a comprehensive set of interventions to mitigate the impact of rising commodity prices.
Socioeconomic Planning Secretary Karl Kendrick T. Chua said the impact of Russia's invasion of Ukraine is felt domestically on food, basic goods, transport and utilities.
“To address this, we have put in place a comprehensive set of interventions for all affected sectors,” Chua said.
But Mapa added that agriculture should also be prioritized by the next administration to address supply-side risks and inflation.
The BSP said it would review the inflation outlook, macroeconomic prospects and the release of the first quarter growth numbers during its next monetary policy meeting.
The Monetary Board will meet on May 19.
-- with a report from Warren De Guzman, ABS-CBN News