THE overall rise in prices of widely used goods likely slowed in March, the central bank said on Tuesday, as oil prices plunged and food prices remained stable due to a price freeze amid the coronavirus disease 2019 (COVID-19) outbreak.

In a statement on Tuesday, the Bangko Sentral ng Pilipinas (BSP) Department of Economic Research said inflation could settle between 2% to 2.8% in March. The range is closer to the low-end of the 2-4% target by the BSP for 2020 and 2021.

Inflation stood at 2.6% in February, slower than the 2.9% in January and the 3.8% print in February 2019.

“The sharp decline in the prices of petroleum products due to the significant fall in global crude oil prices contributed to the downward price pressures for the month,” the central bank said.

Oil prices plunged in early March when Saudi Arabia, the world’s biggest oil exporter, lowered its selling price to compete against Russia, its closest competitor, despite falling market demand due to the COVID-19 outbreak.

The Monetary Board last month downgraded its average inflation outlook for 2020 to 2.2% from the 3% previously penciled in. It also revised its 2021 average inflation forecast to 2.4% from the previous 2.9%.

“The BSP forecasts tamer inflation this year and next… The main driver for the downward adjustment is the collapse of world crude oil prices. Dubai crude oil price is now at its 18-year low of $22.51 per barrel from its recent peak of $85 per barrel in 2018,” BSP Governor Benjamin E. Diokno told reporters in a Viber message on Tuesday.

The central bank said slower inflation in March will also be supported by stable food prices as the government imposed a price freeze on basic necessities from March 16 to May 15.

“The prices of selected food products remained broadly stable in March due to adequate supply and favorable weather conditions along with the price freeze imposed on basic necessities by the Department of Trade and Industry and the Department of Agriculture,” the BSP said.

At the same time, the BSP flagged a slight uptick in electricity rates for those areas served by Manila Electric Co. (Meralco).

The distribution utility raised overall electricity rates for the month to P10.4961 per kilowatt-hour (/kWh), up by P0.0894/kWh from the previous month.

Amid the enhanced community quarantine in Luzon, Meralco announced it will temporarily suspend physical meter reading and bill delivery. It said the monthly bill will be based on customers’ average electric usage for the past three months as per the advice of the Energy Regulatory Commission.

The Philippine Statistics Authority will report March inflation data on April 7. — Luz Wendy T. Noble