Inflation continued to ease in October, at 0.8 percent from 0.9 percent the previous month as the heavily-weighted food and non-alcoholic index continue to drop.
The Philippines Statistics Authority said this is the fifth consecutive month that inflation has slowed down this year.
October’s figure is also the slowest since May 2016.
“The downtrend in the inflation in October 2019 was mainly due to the 0.9 percent annual drop registered in the heavily-weighted food and non-alcoholic beverages index,” PSA said.
Specifically, annual rates declined further in the indices of rice at 9.7 percent; and sugar, jam, honey, chocolate and confectionery, 4.3 percent. In addition, annual decreases were still noted in the indices of corn at 3.9 percent and vegetables at 0.8 percent.
Contributing to the decline is the transport index which registered 1.7 percent during the month.
Slower annual increments were also noted in housing, water, electricity, gas, and other fuels index; furnishing, household equipment and routine maintenance of the house index; and, health, and restaurant and miscellaneous goods and services index.
Annual increases were higher in the indices of alcoholic beverages and tobacco at 16.5 percent; and clothing and footwear at 2.8 percent.
PSA also said that excluding selected food and energy items, core inflation decelerated further to 2.6 percent in October.
In the previous month, core inflation was registered at 2.7 percent and in October 2018, 4.9 percent.
Benjamin Diokno, Bangko Sentral ng Pilipinas (BSP) governor, said the October figure was within the BSP’s forecast range of 0.5 to 1.3 percent.
“The latest inflation outturn is consistent with the BSP’s prevailing assessment that inflation has likely bottomed out in October and could start to pick up slightly in the remaining months of 2019 as base effects start to dissipate,” Diokno said.
The BSP continues to expect average inflation to firmly settle within the target range of between 2 and 4 percent for this year up to 2021.
“Global crude oil prices have started to stabilize following the recent volatility caused by geopolitical tensions in the Middle East. Meanwhile, deepening trade tensions between China and the US along with other countries in the region have raised global economic uncertainty, which pose a downside risk to the inflation outlook,” Diokno said.
“The government has been driven and focused in its anti-inflationary efforts this year. We hope to further keep inflation manageable and within the government’s target,” said Adoracion Navarro, officer-in-charge and Undersecretary for Regional Development of the National Economic and Development Authority.
Navarro said although the government welcomes the easing of inflation, the country must be in the lookout for upside risks such as cases of African Swine Fever (ASF), which have been observed so far in Rizal, Pangasinan, Bulacan, Nueva Ecija, Pampanga, Cavite and Quezon City.
“The livestock industry in the said ASF-stricken areas, which accounts for 21.7 percent of the country’s total hog production last year, remains at high risk. The government and private companies must collaborate to manage, contain, and control the spread of the disease,” Navarro said.
Navarro added stricter biosecurity measures must be enforced and quarantine checkpoints and disinfection facilities must be expanded and placed in key gateways such as seaports, airports, and expressways to prevent the spread of ASF.
Salvador Panelo, chief presidential legal counsel, said Malacanang welcomed the announcement and said that “this should be good news to all Filipinos, especially to President Duterte’s doubters or cynics.”
“Bringing a comfortable life for all Filipinos, which includes taming inflation, is the foremost socioeconomic goal of the Duterte Administration,” he said.
Panelo said the latest inflation rate is a testament that the President’s strong political will which, together with his economic team’s sound and working macroeconomic policies and measures, contributed to the downward trend of prices and goods.
Per region, PSA said inflation was higher in National Capital Region (NCR) at 1.3 percent from 0.9 percent the previous month.
The uptrend was brought about by higher annual increments in the indices of food and non-alcoholic beverages, and clothing and footwear, both registered at 1.8 percent; and alcoholic beverages and tobacco at 10 percent.
Inflation in areas outside NCR decelerated further to 0.7 percent in October from 0.9 percent in September.
Declines were still registered in the indices of food and non-alcoholic beverages at 1.4 percent; and transport, 1.3 percent.
Twelve regions in areas outside NCR either had negative or lower annual rates in October 2019.
The lowest annual rate of -1.3 percent during the month was still observed in Region IX (Zamboanga Peninsula), while the highest inflation of 2.3 percent was recorded in Region III (Central Luzon).