Headline inflation decelerated further to 6.03 percent year-on-year in November 2018 from 6.68 percent in October and 6.70 percent in September. The year-to-date average of 5.2 percent is above the Government’s announced inflation target range of 3.0 percent ± 1.0 percentage point for 2018. Month-on-month seasonally-adjusted headline inflation turned negative in November at -0.3 percent from 0.4 percent in October 2018. On the other hand, core inflation—which excludes selected volatile food and energy items to measure underlying price pressures—rose further to 5.1 percent in November from 4.9 percent in the previous month.
The lower inflation reading was attributed largely to slower price increases in both food and non-food commodities. Food inflation rate moderated further in November 2018 due to slower price increases of corn, meat, fish, fruit, and vegetables. At the same time, rice prices also declined amid ongoing main harvest season and arrival of rice imports. Similarly, non-food inflation eased in November as liquefied petroleum gas (LPG) prices declined while inflation for actual rentals for housing also decelerated. Transport inflation remained steady in November as the approved fare hikes for public utility jeepney and buses were offset by price rollbacks of domestic petroleum products.
The latest inflation outturn confirms the BSP’s assessment that price pressures have started to ease in Q4 2018. The Monetary Board will take into account this latest development and other new information at its next monetary policy meeting. Monetary authorities remain vigilant with respect to the inflation outlook and demand conditions and will continue to ensure that monetary policy stance remains consistent with its price stability mandate.