MANILA, Philippines (AP) — The Philippine central bank has raised its key interest rate by a quarter percentage point to counter inflation.

The rate the central bank charges commercial banks for overnight borrowing was Thursday raised to 5.75 percent.

Central bank Gov. Amando Tetangco says the decision was “a pre-emptive response to signs of inflation pressures and elevated inflation expectations.”

He says latest forecasts for inflation have shifted closer to the higher end of the 2015 target range of 2 to 4 percent.

Tetangco cites higher food prices, short-term volatility in oil prices and pending power rate and transport fare increases as adding to risks.

Last month’s Inflation rate was 4.4 percent, within government’s 2014 target.

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