Headline inflation rose to 2.8 percent year-on-year in November from 1.6 percent in October. The resulting year-to-date average of 3.2 percent is well within the Government’s target range of 2.5-4.5 percent for 2009. Core inflation, which excludes some food and energy items to measure generalized price pressures, was unchanged from the October level of 2.7 percent year-on-year. Month-on-month headline inflation was also unchanged from the previous month at 0.6 percent.
The uptick in inflation was due mainly to the increase in the inflation rates of specific food items, namely: fruits and vegetables, rice, and meat. The supply of these food items was affected adversely by the recent weather disturbances that visited the country. Fuel inflation, which had been negative for almost a year, moved to positive territory in November and likewise contributed to the increase in inflation. Meanwhile, the inflation rate of transportation and communication services remained negative in November, albeit less negative than the rate in the previous month.
Governor Amando M. Tetangco, Jr. noted that the November inflation number was within the 2.4-3.3 percent forecast range of the BSP. He added that the latest assessment continues to show within-target inflation for both 2009 and 2010. Going forward, he said that the BSP will stay focused on monitoring emerging risks to the inflation outlook to ensure that monetary policy settings remain consistent with price stability and at the same time supportive of economic recovery.