Philippines: Inflation recedes slightly in February
March 5, 2014
In February, consumer prices increased 0.07% over the previous month, which was down from the 0.66% rise registered in January and marked the lowest level in over a year. The modest monthly increase was primarily driven by higher prices for key food items such as rice, due to some lingering domestic supply issues following the typhoon. Prices for alcoholic beverages and tobacco also increased over the previous month.
Annual inflation inched down from the 26-month high of 4.2% in January to 4.1% in February. Meanwhile, annual average inflation - the reference rate used by the Central Bank as a guide for monetary policy - inched up from 3.0% in January to 3.1% in February. Average inflation is still within 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, rose 0.15% over the previous month in February (January: 0.68% month-on-month). Annual core inflation fell from 3.2% in January to 3.0% in February.
The Central Bank has set an inflation target of 4.0% plus/minus 1.0 percentage points for 2014 and of 3.0% plus/minus 1.0 percentage points for 2015. FocusEconomics Consensus Forecast panelists expect annual inflation to average 3.8% in 2014, which is unchanged from last month's forecast. For 2015, the panel expects inflation to average 3.8%.
Author: Carl Kelly, Economist