BSP raises inflation forecast amid rising fuel prices

Inflation may remain elevated in the short term before settling within the government target of 2 to 4 percent, Bangko Sentral ng Pilipinas Governor Benjamin Diokno said Friday.

The BSP revised its inflation forecast for 2021 to an average of 4.1 percent, up from a previous estimate of 4 percent.

Higher global crude oil and non-oil commodity prices contributed to the higher inflation forecast, with concerns over delays in imported pork due to the African Swine Fever outbreak also impacting local supply.

Diokno noted that Dubai crude oil prices could remain elevated due to recovery in global economic activity and strong demand, but these risks are transitory.

Next year, inflation is expected to settle at 3.1 percent on average.