Manila: The country's headline inflation could reach 7.1 percent to 7.9 percent in May due to upward price pressures from key food commodities and exchange rate movements, the Bangko Sentral ng Pilipinas (BSP) said on Saturday.

According to Philippines News Agency, the higher prices of rice, vegetables, and meat contributed to the upside risks to inflation during the month. The central bank indicated that a weaker local currency also added to inflationary pressures. These factors were expected to exert significant pressure on consumer prices.

The BSP projects May 2026 inflation to settle within the range of 7.1 to 7.9 percent. Upside price pressures were driven by rising prices for rice, vegetables, and meat, as well as the depreciation of the peso, the BSP stated in its month-ahead inflation forecast.

The BSP noted that several factors helped temper the increase in prices. The recent rollbacks in domestic fuel prices, lower prices for fish, and slightly lower electricity rates partially offset the prevailing upside price pressures, it said.

Headline inflation had accelerated to 7.2 percent in April from 4.1 percent in March. The April inflation data exceeded the BSP's forecast range of 5.6 percent to 6.4 percent for the month. The increase was primarily driven by faster increases in food and transport costs, reflecting the impact of the global oil volatility triggered by the conflict in the Middle East.