BSP: Low inflation expected despite supply chain disruptions

The Bangko Sentral ng Pilipinas (BSP) warns that supply chain disruptions could cause short-term spikes in inflation due to weak local demand and plunging global oil prices.

However, the central bank expects inflation to remain low over the next few months with a baseline forecast showing inflation easing below the 2% to 4% target range starting Q3 2020 until Q1 2021.

BSP Governor Benjamin Diokno assured that regulators are ready to deploy measures to support the economy amid the pandemic, while Assistant Governor Iluminada Sicat noted potential risks from food prices and remittances due to repatriated OFWs.