BSP flags supply-side risks as inflation hits 5-month high

The Bangko Sentral ng Pilipinas (BSP) flagged supply-side risks, including tariffs and food prices, as inflation accelerated to a five-month high of 1.7% in September.

Despite the recent uptick, the BSP still expects inflation to settle within the target range for the year, and remain within the band for 2026 and 2027.

The central bank noted that inflation expectations remain well-anchored.

However, higher rice tariffs and rising global food prices could exert upward pressure on inflation over the policy horizon.

These potential supply-side pressures are partly influenced by President Ferdinand "Bongbong" Marcos Jr.'s August order for a 60-day ban on rice imports.

The BSP also anticipates that higher electricity rates could be offset by subdued global oil prices due to a stable production outlook.