July inflation seen at 5.6%-6.6% — BSP

MANILA, Philippines — The Bangko Sentral ng Pilipinas (BSP) has forecast that inflation in July could settle within the range of 5.6% to 6.6%. The central bank cited higher prices of oil and electricity rates as factors that could push inflation higher. "Upside price pressures during the month could stem from elevated domestic petroleum pump prices, higher electricity rates, increasing fish prices, and the depreciation of the peso against the strengthening US dollar,” BSP’s statement released on Friday, July 31 read. In June, the inflation rate in the country slowed down to 6.4% as local pump prices started to go down following a temporary ceasefire between US-Israel and Iran. However, tensions in West Asia intensified again in mid-July, causing oil and fuel prices to increase again. Last week’s increase in diesel, kerosene and gas products ranged from P3 to P11, while this week’s increase is at P4 to P7. Meanwhile, electricity rates had become an issue this month after the Department of Energy announced that the country’s average power price rose to P12.43 per kilowatt-hour, which has become the highest in Southeast Asia. The value of peso also sank to 61.847 to US$ on July 24. President Ferdinand Marcos Jr. addressed the issues of rising oil prices and electricity rates during his SONA earlier this week and proposed measures to cushion their impact on the public, such as scrapping the system loss charges from consumers' electricity bills. Meanwhile, BSP said inflation could be mitigated by lower prices of key food commodities like rice, meat, vegetables, and fruits.