INFLATION. The Bangko Sentral ng Pilipinas projects the May 2023 inflation rate to range between 5.8 percent to 6.6 percent, with the upper end same as that of last April's level. Higher prices of several food items like rice and vegetables, cooking gas and Meralco power rates are expected to drive inflation for the month. (PNA file photo)

MANILA – Upticks in the prices of rice, vegetables and several other key food items are projected to drive the country’s inflation rate for May 2023 to between 5.8 percent to 6.6 percent.

In a statement on Wednesday, the Bangko Sentral ng Pilipinas (BSP) said the rise in the prices of liquefied petroleum gas (LPG) and the rate of electricity in areas being serviced by the Manila Electric Company (Meralco) are also forecast to provide upward pressures in the rate of price increases for the month.

These factors are, however, seen to be countered by the rollback in the prices of domestic petroleum, lower prices of poultry and fish, and decline in the power rates of regional power distributors.

“Going forward, BSP will continue to monitor developments affecting the outlook for inflation and growth in line with its data-dependent approach to monetary policy formulation,” the central bank added.

Domestic inflation rate decelerated for the third consecutive month last April to 6.6 percent after hitting a 14-year high of 8.7 percent last January.

Monetary authorities see the sustained slowdown of inflation rate and its return to within the government’s 2 to 4 percent target band in the last quarter of 2023.

BSP's policy-making Monetary Board has slashed the central bank’s average inflation forecast for this year from 6 percent to 5.5 percent, and for 2024 from 3.1 percent to 2.8 percent in line with the expectations that inflation rate will continue to post slower rates in the coming months. (PNA)