November Inflation Decelerates Further to 3.7 Percent

Headline inflation slowed down to 3.7 percent year-on-year in November from 4.3 percent in October. The November inflation reading was within the BSP’s forecast range of 3.5-4.3 percent for the month. The resulting year-to-date average inflation rate of 4.3 percent was also within the Government’s inflation target range of 4.0 percent ± 1.0 percentage point for 2014. Likewise, core inflation—which excludes certain food and energy items to better capture underlying price pressures—eased to 2.7 percent in November from 3.2 percent in the previous month. On a month-on-month seasonally-adjusted basis, the change in the consumer price index declined by 0.1 percent in November from 0.2 percent in October.

The continued deceleration of headline inflation in November was driven largely by the lower prices of electricity and domestic petroleum products along with the slower increases in food prices. Non-food inflation edged lower due mainly to lower pump prices of diesel and gasoline (reflecting declines in international oil prices), price reductions in kerosene and LPG as well as the downward adjustment in electricity rates as a result of lower generation charges. Similarly, food inflation slowed down on adequate domestic supply of key food items, particularly rice, corn, meat, oils, vegetables, and sugar.

Governor Amando M. Tetangco, Jr. said that the latest inflation reading is in line with the BSP’s assessment of a manageable inflation environment over the policy horizon. Looking ahead, the BSP will remain vigilant in monitoring developments on both the global and domestic fronts and stand ready to undertake appropriate measures, as needed, to safeguard its price stability objectives.

Source: www.bsp.gov.ph