Philippines: Inflation moderates on flat food prices
September 6, 2011
In August, consumer prices added 0.08% over the previous month, which mirrored the price increase observed in July. The result mainly reflected stable food prices, which contrasted July's 0.15% month-on-month rise. Annual headline inflation moderated from 5.1% in July to 4.7% in August, partially boosted by the favourable base effect from the same month last year when prices soared 0.41% mom. Meanwhile, annual core inflation, which excludes the price volatility associated with items such as oil and food, fell from 3.7% in July to 3.4% in August. Annual average inflation, which is the reference rate used by the Central Bank to conduct monetary policy, stalled at 4.4% in August. Currently, annual average inflation lies within the 1% tolerance margin around the 4.0% target rate set by the Bank for 2011. Moreover, on 8 September, the Central Bank left the benchmark interest rate unchanged at 4.50% for a fourth consecutive month amid uncertainty regarding global economy.