If there is anything I can say about the May inflation forecast of Bangko Sentral, where are they getting their figures on electric rates going down, lower rice prices and declining prices of LPG (cooking fuel).
The forecast inflation rate for May 2022 is expected to settle at the range of 5 to 5.8 percent, which in April was only at 4.9 percent.
The uptick is due to supply chain uncertainties, the global turmoil in inflation triggered by the continuing war of Russia in Ukraine, the Fed's adjustments of its policy rates, and the continued increase in petroleum prices, higher prices of key food items and peso depreciation.
The month- ahead inflation forecast could be offset in part by lower electricity rates in Meralco-serviced areas, decline in LPG prices, and lower rice prices. I have yet to come across a Meralco customer who says his electric bill had dropped and a buyer of LPG that would say they bought the 11-kilo cylinder for less than P1,000. As for rice prices, rates in the wet market do not drop below P40 a kilo, so where is Bangko Sentral getting its data.
Looking ahead, the BSP will continue to monitor closely emerging price developments to enable timely intervention to arrest emergence of further second-round effects, consistent with BSP’s mandate of price and financial stability.
Tags: #inflationforecastforMay, #pricedrops, #causesofinflationaryupticks, #economy