percentage points ( ppts ) above the high end of the inflation target range of 2. 0 percent to 4. 0 percent for the year. nonetheless, as projected, inflation has gone down significantly, falling toward the midpoint ( at 3. 0 percent in april 2019 ) of the target band in the latest inflation print. this is not surprising given that the price pressures in 2018 were driven by cost - push factors. with the abatement of supplyside pressures, inflation has also started falling within target. the contribution of food inflation ( represented by the yellow bar ) to overall inflation has dropped markedly especially with rice prices easing in recent months brought about by the continued arrival of imports and the onset of the summer harvest season. looking ahead, we expect inflation to remain on a target - consistent path for 2019 and 2020. the latest baseline forecasts ( as of 9 may 2019 mb policy meeting ) indicate that inflation is projected to average at 2. 9 percent for 2019 while inflation forecast for 2020 is slightly higher at 3. 1 percent 1 / 4 bis central bankers'speeches due largely to the rebound in crude oil prices. meanwhile, risks to the inflation outlook remain broadly balanced for 2019 amid risks of a prolonged el nino episode and higher - than - expected increases in global oil prices. for 2020, the risks continue to lean toward the downside as weaker global economic activity could temper commodity price pressures. similarly, forecasts of other institutions generally convey the same expectations. results of the bsp ’ s april 2019 survey of private sector economists showed lower mean inflation forecast for 2019 at 3. 1 percent from 3. 3 percent in the previous survey round. the mean inflation forecasts for 2020 and 2021 both declined to 3. 3 percent from 3. 4 percent. meanwhile, projections from other institutions also show inflation within target for this year and the next. analysts expect inflation to continue easing and settle within the government ’ s target range. however, possible upward pressures are seen to keep inflation from further decelerating. ( upside risks to inflation ) : potential rebound in global crude oil prices, adverse weather conditions such as el nino, higher electricity rates, reduction in the bsp ’ s policy interest rate, and higher domestic demand due to the upcoming midterm elections and school enrollment ( downside risks to inflation ) : the lower inflation prints, implementation of non - monetary policy actions to increase domestic food supply and stabilize prices such as the rice tariffication law and the mitigating measures put in place by the

the view that the prospects for domestic demand remain firm, to be supported by a projected recovery in household spending and the continued implementation of the government ’ s infrastructure program. in addition, the mb observed that the global economic growth momentum has slowed down in 2019. meanwhile, indications of slower growth in domestic liquidity and credit require careful monitoring. at the same time, the mb also noted that the risks to the inflation outlook remain broadly balanced for 2019 amid risks of a prolonged el nino episode and higher - than - expected increases in global oil prices. for 2020, the risks continue to lean toward the downside as weaker global economic activity could temper commodity price pressures. looking ahead, the bsp will continue to monitor developments affecting the inflation outlook to ensure that the monetary policy stance remains consistent with its price stability objective. on the other hand, the passage of republic act no. 11211, or an act amending republic act no. 7653, known as the ‘ new central bank act ’ ( signed on 14 february 2019 ) is a significant milestone for the bsp. our three pillars of central banking, that of price stability, financial stability, and an efficient payments and settlements system, were further strengthened with the expansion of the bsp ’ s policy toolkit. the law restored the central bank ’ s authority to issue its own debt papers as part of its regular monetary operations, establishes a stronger prudential regulatory framework to promote a safe and sound financial system through the expansion of supervisory coverage, and authority to prescribe metrics attuned to international standards and practices. the amendment likewise empowers further the bsp to oversee the country ’ s payment and settlement systems ( pss ), including critical financial market infrastructures that are vital components of the pss. additional notes : the amended bsp charter restores the central bank ’ s authority to obtain data from any person or entity from the private and public sectors for statistical and policy development purposes in line with the pursuit of our triad mandates. the law authorizes the increase in the capitalization of the bsp from php 50 billion to php 200 billion, which shall be sourced from dividends declared by the bsp in favor of the national government. under the amended charter, the bsp is also exempt from paying taxes on income derived from its governmental functions. these reforms place the bsp on a stronger position to pursue its mandate amidst a growing economy and the increasing sophistication of the financial system. looking ahead, we will continue