Inflation cools anew in October but seen rebounding in next months
MANILA, Philippines — Consumer price growth softened anew in October, the Philippine Statistics Authority reported Tuesday, continuing a downtrend as base effects from last year’s red-hot inflation kick in.
Inflation last month eased to 0.8%, slower than September’s 0.9% and a sharp fall from a year ago, which saw inflation peak at a nine-year high of 6.7% amid food supply bottlenecks at the time.
The latest reading was the slowest since the 0.7% rate recorded in April 2016. Year-to-date, inflation averaged 2.6%, settling within the government’s 2%-4% annual target.
According to the PSA, the 0.9% annual drop in heavily-weighted food and non-alcoholic beverages index mainly contributed to the benign inflation in October. Prices of rice — a Filipino main staple — fell for the sixth straight month 9.7% while prices of corn, a popular rice substitute, contracted 3.9%.
Transport costs likewise posted a decline last month by 1.7%. Meanwhile, softer price gains were registered in energy-related items and utility costs.
“Base effects played a major role in forcing the headline print below 1% for a second straight month, with heavyweights food and transport posting negative price inflation,” said Nicholas Mapa, senior economist at ING Bank in Manila.
“But with the base effects from the peak of 2018 fading quickly, we expect inflation to revert to target as early as December,” Mapa added.
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