Philippines: Inflation accelerates to highest level in seven months
November 5, 2013
In October, consumer prices rose 0.15% over the previous month, which is down from the 0.60% increase registered in September. Higher prices for food and non-alcoholic beverages as well as for clothing and footwear were the most important drivers behind the monthly rise.
Annual inflation edged up from 2.7% in September to 2.9% in October, which represents the highest print observed in seven months. Meanwhile, annual average inflation, which is the reference rate used by the Central Bank as a guide for monetary policy, remained stable over the previous month at 2.8% in October. At the current level, average inflation remains below the Central Bank's target of 4.0% plus/minus 1.0 percentage points.
The core inflation index, which excludes volatile items such as food and oil, inched up 0.15% over the previous month (September: 0.08% month-on-month). Annual core inflation edged up from 2.3% in September to 2.5% in October.
The Central Bank expects inflation to settle within the lower end of its target of 4.0% plus/minus 1.0 percentage points in both 2013 and 2014. FocusEconomics Consensus Forecast panelists expect annual inflation to average 3.4% in 2013, which is down 0.2 percentage points from last month's forecast. For 2014, the panel expects inflation to average 3.9%, which is unchanged from last month's projection.
Author: Carl Kelly, Economist