Inflation hits peak; upside risks remain

MANILA, Philippines (Xinhua) - Philippine inflation may have already reached its peak when it hit 4.9 percent in July and in August but upside risks such as the pending adjustments of power rates remain, the local central bank said today.

Bangko Sentral ng Pilipinas (Philippine central bank or BSP) Deputy Governor Diwa C. Gunigundo said removing bottlenecks in the country's supply chain such as the port congestion problem would help temper inflation in the remaining months of the year.

"It looks like inflation has peaked, at least on the basis of our preliminary forecast," Gunigundo said.

Inflation eased to 4.4 percent in September due to lower increases of food prices and housing and utility rates. The rate settled at 4.9 percent in August, matching the pace in July, when consumer prices soared to a 33-month high.

Gunigundo said inflation in the remaining months of the year could be tempered by moderating oil prices in global markets and the slowing global economy which may reduce demand for commodities.

He issued his statement ahead of the Monetary Board's rate- setting meeting scheduled for Oct. 23.