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May 27, 2024

Evaluation report affirms BSP’s superiority in inflation projections

The Bangko Sentral ng Pilipinas (BSP) asserts its prowess in inflation forecasting, highlighting a long-standing record of unwavering accuracy, impartiality, and efficiency over the past 12 years.

Through an extensive evaluation report encompassing the period from 2010 to 2022, the BSP reaffirms its exceptional performance in both monthly and annual inflation projections, outshining its peers, including the International Monetary Fund (IMF) and private sector economists.

The BSP’s latest Monetary Policy Report (MPR) extensively evaluated its inflation forecasting performance in terms of precision, impartiality, efficiency, and comparison with other projections. Based on their comprehensive analysis, the BSP expressed confidence in their accomplished track record and emphasized their commitment to maintaining excellence in forecasting.

A noteworthy example is the month-ahead inflation forecast, where the BSP accurately predicted that actual inflation would fall within the forecasted range 143 times out of 155 months from 2010 to 2022, resulting in an impressive batting average of 92.3 percent.

The MPR also highlighted the BSP’s consistency in delivering accurate forecasts, noting that all 11 month-ahead inflation projections in 2022 aligned with the forecast range announced by the BSP, typically released on the last working day of each month.