September Inflation Slows Down to 4.4 percent

Headline inflation eased to 4.4 percent year-on-year in September from 4.9 percent in August. The September inflation reading was within the BSP’s forecast range of 4.1-4.9 percent for the month. The resulting year-to-date average inflation rate of 4.4 percent was within the Government’s inflation target range of 4.0 percent ± 1.0 percentage point for 2014. Meanwhile, core inflation—which excludes certain food and energy items to better capture underlying price pressures—held steady at 3.4 percent in September. On a month-on-month seasonally-adjusted basis, the change in the consumer price index decelerated to 0.1 percent from 0.4 percent in August.

The lower inflation in September was attributed largely to slower increases in prices of food, electricity, and domestic petroleum products. Food inflation slowed down on adequate domestic supply of key food items, particularly rice, corn, and vegetables. Likewise, non-food inflation edged lower due mainly to the downward adjustment in electricity rates as a result of lower generation charges as well as price reductions in kerosene, LPG, diesel, and gasoline.

Officer-In-Charge Vicente S. Aquino said that the BSP will continue to closely monitor price movements and will stand ready to undertake preemptive policy action as necessary to safeguard its price and financial stability objectives.

Source: PCOO, www.bsp.gov.ph