MANILA, Aug. 31 (Xinhua) -- The Philippine central bank on Friday projected overall increase in prices of widely-used goods and services to settle at around 5.9 percent year-on-year in August.

"Higher price of rice and key food items due to weather disturbances and supply disruptions, increase in gasoline and liquified petroleum gas (LPG) prices, and slight upward adjustment in electricity rates contributed to upward price pressures in August," the Bangko Sentral ng Pilipinas (BSP) said in a statement.

Meanwhile, the BSP said lower diesel and kerosene prices as well as modestly appreciated peso could partly temper price pressures this month.

The BSP said it will remain watchful of economic and financial developments that could affect the inflation outlook and will closely monitor inflation expectations and emergence of further second-round effects ahead of the September 2018 Monetary Board policy meeting.

Headline inflation hit 5.7 percent in July, bringing the seven-month average to 4.5 percent, already above the government's full-year target range of 2 to 4 percent.

The BSP's policymaking Monetary Board hiked the key interest rate by 25 basis points each in May and June, followed by 50 basis points amid higher-than-expected inflation in August.