The moderate rate of increase in consumer prices in September was a result of base effects, the Department of Finance (DOF) said.
Based on the DOF economic bulletin dated Oct. 5, Finance Undersecretary Gil Beltran said the 0.5 percentage-point jump in inflation last month was within the expectations of the economic authorities.
“The general price level increased by 2.3 percent in September, a jump by 0.5 percentage point from the August inflation rate. This apparent surge was largely a result of base effects: Inflation rate in September of last year was only 0.4 percent,” Beltran said.
In his report to Finance Secretary Carlos Dominguez III, Beltran also noted that September’s inflation rate was still within the Bangko Sentral ng Pilipinas (BSP)’s target range of 2 percent to 4 percent.
However, Beltran said that inflation would likely remain above the 2 percent level in the short-term after commodity prices rose at a faster pace in August and September.
Core inflation also quickened to 2.3 percent in September from 2.0 percent in the previous month and 1.4 percent in the same period last year.
“Core inflation suggests that in the short-term, headline inflation rate will be above 2 percent,” Beltran said. “A continued regime of stable prices will provide cushion to absorb shocks to the economy and help sustain rapid economic growth.”
In September, the general price increase for food and non-alcoholic drinks further rose to 3.1 percent from 2.4 percent, contributing 1.3 percentage point to inflation. Rice prices were up 1.0 percent, while vegetables accelerated to 10.8 percent.
The National Economic and Development Authority (NEDA) attributed the jump in food prices to the adverse effects of the series of tropical cyclones that had devastated the country.
Meanwhile, prices of alcoholic drinks and tobacco grew by 6.2 percent from 6.0 percent in August; clothing and footwear increased by a faster 2.7 percent from 2.6 percent; and furnishing, household and equipment to 2.3 percent from the previous 2.2 percent.
Likewise, housing, utilities and fuels jumped to 0.9 percent from 0.1 percent in the previous month, while transport quickened to 0.2 percent from 0.1 percent.
However, inflation rate on health (2.7 percent), restaurants & miscellaneous services (2.4 percent), education (1.8 percent), recreation and culture (1.7 percent), and communication (0.1 percent) were steady month-on-month in September.
Moreover, headline inflation for January to September this year averaged at 1.6 percent, still below the low end of the government’s inflation target of 2.0 percent to 4.0 percent.
Last month, Manila Electric Co. (Meralco)’s rate per kilowatt hour (kWh) for an average of 300 kilowatts-per-month consumption dipped to P8.77 from P8.82 in August and P8.87 a year ago.
The average price of diesel in Metro Manila among the “big three” oil companies, meanwhile, accelerated to P37.83 per liter from P26.01 in the previous month and P25.39 registered in the same month last year.
Average price of gasoline during the month, on the other hand, declined to P37.22 per liter from P38.8 in August and P41.39 a year before.
