Inflation in October held steady at 6.7 percent, unchanged from the previous month’s level, leading the Bangko Sentral ng Pilipinas (BSP) to state that it may have finally peaked, as the reading is further reinforced by a deceleration in heavily-weighted food items.
BSP Governor Nestor A. Espenilla Jr., in a message to reporters Tuesday, said the latest inflation figure “supports the view that inflation pressures are finally moderating.” “It’s a significant deceleration although the headline figure remains elevated,” he said.
The central bank chief also noted that “second round effects are also muted so far.”
“That augurs well for a return to inflation target by 2019,” he said.
“The MB (Monetary Board) will take into account these and other incoming data including GDP (gross domestic product) at its next policy meeting when it determines if there’s still need for further policy rate adjustments,” he added.
The government is scheduled to report on the domestic economy’s third quarter performance on Thursday, November 8, while the MB will have its next rate setting meet on November 15.
Philippine Statistics Authority (PSA) data show that inflation in October 2017 is lower at 3.1 percent.
To date, average inflation stood at 5.1 percent, still above the two to four percent target band until 2020.
Core inflation, which excludes volatile food and oil items, meanwhile registered a faster rate of 4.9 percent from month-ago’s 4.7 percent. Average in the 10-month period is at 4 percent.
Food inflation, on the other hand, was the major driver of elevated overall inflation, for most of this year slowed to 9.4 percent from the previous month’s 9.7 percent.
Authorities earlier said inflation is projected to start slowing down following the implementation of several measures since last September to ensure adequate supply of food items like rice, vegetables and meat.
These measures include the release of rice stocks in the warehouses of the National Food Authority (NFA) nationwide and ensuring that rice that have been recently imported will be delivered securely from ports to NFA warehouses and the various markets around the country.PNA