The Bangko Sentral ng Pilipinas (BSP) expects inflation to remain comfortably within its target range in the coming years, but has flagged signs of weakening domestic growth amid governance and confidence concerns.
In a statement released Wednesday, the BSP said the October 2025 inflation rate—which stayed steady at 1.7 percent—fell within its forecast range of 1.4 to 2.2 percent. The central bank projected inflation to average below the low end of its target for 2025, largely due to easing rice prices in previous months.
“The outlook for inflation is generally benign, remaining well within the target range over the policy horizon,” the BSP noted, projecting inflation to settle within the 3.0 percent ± 1.0 percentage point band for both 2026 and 2027.
The central bank said inflation expectations remain well-anchored despite possible upside risks from electricity rate adjustments and potential tariff increases on rice imports. These pressures, however, are seen as limited given the stabilization of global commodity prices.
While inflation appears manageable, the BSP flagged headwinds on the growth front. “The outlook for domestic economic growth has weakened,” the statement read, pointing to the impact of governance concerns surrounding public infrastructure spending, which has weighed on business confidence. Signs of softening demand also reflect uncertainty in the global economic environment.
The Monetary Board emphasized that it will continue to assess new data and the cumulative effects of previous monetary policy actions in its future decisions.
“The BSP remains committed to maintaining price stability while supporting sustainable economic growth,” it said, underscoring its readiness to recalibrate its policy stance in response to evolving domestic and external developments.