Philippine Inflation Slows Down to 2.4% in March

MANILA, PHILIPPINES – Headline inflation in the Philippines eased slightly to 2.4 percent year-on-year in March from 2.5 percent in February, the country’s central bank said in a statement.

The March inflation reading was within the Bangko Sentral ng Pilipinas (BSP)’s range forecast of 2.1-2.9 percent for the month.

The resulting year-to-date average inflation rate of 2.4 percent was also within the Government’s inflation range target of 3.0 percent ± 1.0 percentage point for 2015.

Meanwhile, core inflation, which excludes certain volatile food and energy items to better capture underlying price pressures, rose slightly to 2.7 percent in March from 2.5 percent in the previous month.

On a month-on-month seasonally-adjusted basis, inflation was steady at 0.1 percent in March.

The slightly lower inflation in March was attributed largely to slower increases in prices of food items.

In particular, food inflation slowed down as a result of adequate domestic supply of key food items, particularly rice, corn, meat, milk, oils, fruits, and sugar.

Conversely, non-food inflation rose due mainly to the upward adjustment in electricity rates as well as higher gasoline and diesel prices in most regions, which more than offset the reduction in the flagdown rate for taxi services.

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 keep a close watch on price developments and the evolving inflation outlook in line with the BSP’s commitment to ensure price stability conducive to balanced and sustainable economic growth.

The National Economic Development Authority (NEDA) said inflation in the National Capital Region (NCR) decelerated to 1.9 percent in March 2015 from 2.2 percent in February 2015 and 2.9 percent in the same period a year ago.

This is accounted for by slower inflation in several major commodity groups including food and non-alcoholic beverages. Outside NCR, inflation remained stable at 2.6 percent, slower than the 4.2 percent recorded in the previous year.

“Our overall inflation outlook remains well- anchored as policies continue to be supportive of a stable inflation rate. While the current episode of mild El Niño and power woes still pose risks to inflation, the continuing efforts to ensure that appropriate policy actions are implemented are expected to temper inflationary pressures over the near to medium term,” said Economic Planning Secretary Arsenio M. Balisacan. –