Bangko Sentral ng Pilipinas (BSP) Governor Eli Remolona Jr. expressed optimism over the country’s inflation outlook, noting that consumer price expectations remain “more or less anchored” amid sustained low inflation this year.
In a press conference on Monday, Remolona noted inflation has averaged 1.7 percent from January to October, below the government’s 2 to 4 percent target range.
“Our inflation expectations are, I would say, more or less anchored. In fact, in our statements, we say well anchored,” he said.
“Expectations are not too far away from our target, especially if you look at two years down the road,” he added.
Remolona added he was “happy” with the year-to-date inflation performance, stressing that the BSP’s objective is simply to keep consumer price increases low and manageable.
“That gives us comfort, but at the same time we’re still working to try to measure anchoring more precisely,” he said.
He, however, declined to comment on whether subdued inflation expectations could lead to another policy rate cut next month, reiterating that the Monetary Board will remain data-dependent.
BSP Officer-in-Charge Dennis Lapid said they had recent surveys for the professional economists which showed that inflation might be a little below target for this year but there will be a gradual pickup towards (about 3 percent) for next year.
“The other way we’re looking at expectations is in terms of the distribution of the expectations or the future inflation number that comes up in our surveys, for example, the consumer expectations survey,” he said.
“So if you could demand, if you could sort of somehow plot the responses we get in terms of a bell curve, you can see the bell curves are slowly moving closer towards 2 percent and away from 4 percent,” he added.
The BSP’s final policy meeting for the year is scheduled on Dec. 11.
In October, the central bank signaled space for further easing as concerns grew over the economic impact of ongoing corruption issues involving major flood-control projects and other infrastructures. (PNA)
