The Philippine's annual headline inflation further slowed to 2.8 percent in November, data from the National Statistics Office (NSO) showed on Wednesday.
The November inflation rate was lower than the 3.1 percent recorded in October, reaching the 2.7-percent to 3.6-percent forecast of the Bangko Sentral ng Pilipinas (BSP). Inflation a year ago was at 4.7 percent.
The NSO attributed the low inflation from the deceleration in the annual growths posted in the indices of food and non-alcoholic beverages, housing, water, electricity, gas and other fuels and transport.
For its part, the National Economic and Development Authority (NEDA) said that the ample supply of agriculture and fish, and lower prices of domestic petroleum helped slowed down the movement of prices in November this year.
"The abundant supply of agriculture and fishery products in November 2012 resulted in greater annual reductions in the prices of various food items compared to the previous month," said NEDA Officer-in-Charge Rolando Tungpalan.
Meanwhile, the data added that core inflation was pegged at 3.4 percent in November, slower compared to the 3.6 percent growth in October.
"The lower core inflation implies an easing of demand pressures on consumer prices. With the continued benign price increases for the period, we are expecting that inflation should be manageable for the rest of the year," the NEDA official said.
Core inflation represents a more long-term inflation trend, as it excludes certain items that have short-term and volatile price movements.
On monthly basis, the data showed that prices of consumer items generally inched up by 0.1 percent in November 2012 from -0.1 percent.
The NSO noted that higher charges in electricity rates and price increments in alcoholic beverages, tobacco, clothing items, meals eaten outside the home and some items for personal care and effects in selected regions were observed during the month.
By commodity group, the data stated that on an annual basis, the annual increment in the heavily weighted food and non-alcoholic beverages index in the Philippines decelerated to 2.2 percent in November; housing, water, electricity, gas, and other fuels index, 3.8 percent and transport index, 1.3 percent.
NEDA explained that the prices of kerosene slowed down because of the trimmed trading price of Dubai crude in the international market, which contracted by 1.6 percent from a 4.8-percent growth in October 2012.
On the other hand, annual adjustment in alcoholic beverages and tobacco index was higher at 5.0 percent, health index, 3.1 percent and communication index 0.4 percent, while the rest of the commodity groups retained their last month's rate.
Food alone index was pegged at 2.1 percent in November, slower than the 2.5-percent growth in October.
The annual rate of change in oils and fats index further decreased to -4.9 percent in November from -4.5 percent in October and in vegetables index, -5.3 percent from -0.1 percent.
Slower annual increases were also seen in the indices following food groups such as fish, milk, cheese and egg index, fruits and food products not elsewhere classified, while higher annual movements were recorded in the other food groups.
Furthermore, NEDA mentioned that November 2012's record for consumer prices brings the year-to-date headline inflation to a stable rate of 3.2 percent.
"The average inflation from January to November 2012 remains within the Development Budget Coordination Committee's target range of 3 [percent] to 5 percent for 2012," Tungpalan said.
On the other hand, NSO data noted that prices in Metro Manila also eased to 2.6 percent in November from 2.9 percent in October, as slowdowns in the annual increments in the indices of food and non-alcoholic beverages, housing, water, electricity, gas, and other fuels, transport and restaurant and miscellaneous goods and services were noted during the month.
Similarly, annual inflation in areas outside Metro Manila slid to 2.9 percent in November from 3.3 percent in October with lower annual growths in the indices of food and non-alcoholic beverages; clothing and footwear; housing, water, electricity, gas and other fuels, transport and education.
BSP reaction BSP Gov. Amando Tetangco Jr. said that inflation has remained under controlled, which validates the policies that the central bank enacted over the years.
"Even that there are certain issues that we need to consider moving forward and I'm referring particular to liquidity can be generated by continued capital inflows," he said.
"So, we'll have to make sure that this liquidity is maintained such a level that would continued to support economic growth, so, its again another piece of evidence that the Philippines is in a good position and achieve the idea of convergance of high economic growth. Inflation forecast for 2013 and 2014 is 4 percent," Tetangco added.
For his part, Budget Secretary Florencio Abad said that "We are elated to learn that the year-on-year headline inflation rate in November was registered at a low 2.8 percent year-on-year, as compared to the 4.7-percent rate reported in the same month of last year."
Malacanang also said that it was pleased with the latest inflation figures, and comes at the right time when the Philippine economy is going strong.
(c)2012 The Manila Times (Manila, Philippines)
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Distributed by MCT Information Services
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