BSP statement on the medium-term inflation path
The August 2025 inflation is within the BSP’s forecast range of 1.0 to 1.8 percent. Inflation is projected to average below the low-end of the target range in 2025, primarily due to the continued easing of rice prices.
The outlook for inflation is broadly unchanged. For 2026 and 2027, inflation is expected to trend higher but will remain firmly within the 3.0% + 1.0 ppt target range. Inflation expectations also remain firmly anchored to the target. Meanwhile, possible electricity rate adjustments and higher rice tariffs could raise inflationary pressures over the policy horizon.
The Monetary Board observed that domestic demand has held firm. However, the impact of US policies on global trade and investment continue to weigh on global economic activity. This could temper the outlook for the Philippine economy.
Emerging risks will continue to require close monitoring. The Monetary Board will determine the monetary policy response based on the evolving outlook for inflation and growth.
Going forward, the BSP will safeguard price stability by ensuring monetary policy settings are conducive to sustainable economic growth and employment.
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