MANILA - The Bangko Sentral ng Pilipinas (BSP) on Thursday said it has raised its inflation forecast for this year to an average of 4.9 percent from 4.5 percent announced in June.
BSP Deputy Governor Diwa Guinigundo said they revised their inflation forecast for 2018 because of the increase in jeepney fares, higher water rates, the P2.50 increase in the tobacco excise tax, and the continuing effects of higher world oil prices.
Guinigundo added they also revised their inflation forecast for 2019 to 3.7 percent from 3.3 percent announced in June.
For 2020, the BSP sees inflation at 3.2 percent.
"Our target continues to be 2-4 percent," Guinigundo said.
BSP Governor Nestor Espenilla, meanwhile, said the decision to hike rates did not mean that the BSP was not concerned about growth.
The Philippines' gross domestic product grew 6 percent in the second quarter, from 6.6 percent in the first 3 moths of the year, snapping 10 straight quarters of at least 6.5 percent growth.
Espenilla said that 6 percent growth was "pretty decent."
"Focusing on inflation right now is not necessarily anti-growth. In fact, one can argue that it will sustain growth over the medium term," the BSP chief said.