Philippines Inflation


Philippines: Inflation moderates from almost three-year high

October 8, 2014

In September, consumer prices rose 0.1% over the previous month, which came in below the 0.3% rise recorded in August. September’s deceleration was driven by lower price increases for food, electricity and domestic petroleum products.

Annual inflation fell from August’s 4.9%, which had represented the highest reading since October 2011, to 4.4% in September. Meanwhile, annual average inflation, which is the reference rate used by the Central Bank as a guide for monetary policy, inched up from 4.0% in August to 4.1% in September.

The core inflation index, which excludes volatile items such as food and oil, in September rose 0.1% over the previous month, coming in below August’s 0.3% increase. Finally, annual core inflation stabilized at August’s 3.4%.

The Central Bank’s target inflation rate is 4.0% plus/minus 1.0 percentage point for this year. For 2015, the inflation target is 3.0% plus/minus 1.0 percentage point. FocusEconomics Consensus Forecast panelists expect annual inflation to average 4.3% in 2014, which is unchanged from last month’s forecast. For 2015, the panel expects inflation to average 3.9%.

Author: Teresa Kersting, Economist

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