Headline inflation continued to decelerate to 2.8 percent year-on-year in November from 3.1 percent in October, and was within the BSP’s forecast of 2.7-3.6 percent for the month. The resulting year-to-date average inflation rate of 3.2 percent remains well within the Government's inflation target range of 3-5 percent for 2012. Likewise, core inflation, which excludes certain food and energy items to measure generalized price pressures, slowed down further to 3.4 percent from 3.6 percent in the previous month. Meanwhile, month-on-month headline inflation was higher at 0.1 percent from -0.1 percent in October.
Lower food inflation due to ample domestic supply of selected food items, particularly vegetables and oils, led to lower headline inflation in November. Likewise, slower price increases for non-food items, due largely to the reduction in gasoline and diesel prices, helped push down inflation for the month.
Governor Amando M. Tetangco, Jr. noted that the latest inflation reading continues to be consistent with the BSP’s assessment of a manageable inflation environment over the policy horizon, with average inflation likely to remain within the 3-5 percent target range. The BSP will continue to keep a close watch on emerging price and output conditions to ensure that monetary policy settings remain consistent with the price stability mandate while being supportive of non-inflationary growth.