Headline inflation accelerated to the upper limit of official forecast and hit 6.1 percent in September and well above market consensus of only 5.3 percent, the Philippine Statistics Authority (PSA) reported on Thursday.
This brought the year-to-date inflation rate to 6.6 percent, a level that puts it front and center once again when the policy-making monetary board of the Bangko Sentral ng Pilipinas (BSP) meets to decide this November which way interest rates should go over the near term.
BSP chief and monetary board chairman Eli Remolona Jr. previously made it clear the policy rate determining the cost of all borrowings in the country be “on the table” again should elevated price pressures persist over the policy horizon.
According to the PSA, the uptrend in inflation was brought about by the higher annual increase in the heavily-weighted food and non-alcoholic beverages that accelerated to 9.7 percent from 8.1 percent in August.
Transport also accelerated to 1.2 percent from only 0.2 percent during the period, adding to the pressure.
But data also show core inflation, which removes volatile food and energy prices from the consumer price index, in fact moderated to 5.9 percent from 6.1 percent in August.
Still, food inflation went into superdrive in September to 17.9 percent from only 8.7 percent in August made worse by meat products whose price accelerated as well to 1.3 percent after having actually contracted to minus 0.1 percent in August.
In the consumer price index measured regularly by the PSA, the food and non-alcoholic beverages component account for 39 percent of the consumer price index, much more than housing, water, electricity, gas and other fuels which account for only 22 percent.
National Statistician Dennis Mapa told a news conference that inflation averaged 6.6 percent in the first nine months of the year, way above the BSP’s target average for the year of 2 percent to 4 percent.
He said inflation for rice stood at 17.9 percent in September, twice as fast as the 8.7 percent registered in August despite the imposition of a price ceiling of P41 and P45 per kilo of regular- and well-milled rice, respectively. The September rice inflation was the highest since March 2009 when it stood at 22.9 percent.
“Rice has a weight of 8.87 percent in the headline inflation, a higher level for inflation for the bottom 30 percent income household,” said Mapa.
The inflation rate for the bottom 30 percent accelerated to 6.9 percent in September due mainly to higher food prices from 5.6 percent in August.
