Inflation, which has trended lower than the low end of the target band this year, was seen to dip lower still in August to as low as 1.3 percent, the Bangko Sentral ng Pilipinas said on Thursday.

“The BSP Department of Economic Research (BSP-DER) projects the August 2019 inflation to settle within the 1.3 to 2.1 percent range,” it said.

BSP will remain watchful of economic and financial developments that could affect the inflation environment in line with its commitment to price stability conducive to long-term growth

The outlook builds on inflation already averaging 2.4 percent in July. Also, the latest forecast compares to the 2 to 2.8 percent band projected a month ago.

According to the BSP, upward pressure from the depreciation of the peso and higher price on selected food items could temper the lower price of oil and rice prices along with the downward adjustments in electricity rates.

“Moving forward, the BSP will remain watchful of economic and financial developments that could affect the inflation environment in line with its commitment to price stability conducive to long-term growth,” it said.

Previously, the Development Budget Coordination Committee scaled back the assumed inflation this year from 3 to 4 percent to just 2.7 to 3.5 percent owing in part to the government’s decisive steps to stabilize prices.

Various private sector economists similarly expressed the same sentiment, citing the same factors driving inflation lower for the month.

Security Bank chief economist Robert Dan Roces said inflation could hit as low as 1.3 percent but not more than 2.4 percent and that keeping the rate at sub-2 percent is possible until November 2019.

Likewise, ING Bank senior economist Nicholas Mapa projected August inflation at 1.9 percent owing to the observed easing in supply-side pressures.

Union Bank of the Philippines chief economist Carlo Asuncion forecast a flat 2 percent inflation for the month as rice, fuel and electricity prices continue to drive prices down.