Headline inflation slowed down further to 0.9 percent year-on-year in September 2019 from 1.7 percent in the previous month and was within the BSP’s expected range of 0.6-1.4 percent for the month. The resulting year-to-date average inflation rate of 2.8 percent remained well within the Government’s target range of 3.0 percent ± 1.0 percentage point for the year. Similarly, core inflation—which excludes selected volatile food and energy items to measure underlying price pressures—eased to 2.7 percent in September from 2.9 percent in August. Month-on-month seasonally-adjusted inflation was nil in September compared with 0.1 percent in the previous month.
Most major commodity groups registered either lower or negative inflation rates in September. Year-on-year food inflation has turned negative in September as prices of rice, corn, vegetables as well as sugar, jam, honey, chocolate, and confectionery continued to decline relative to year-ago levels. Among non-food items, electricity, gas, and other fuels inflation remained negative due to lower electricity rates as a result of the downward adjustment in generation charges.
The latest inflation reading remains in line with the BSP’s assessment of a benign inflation outlook, with average inflation expected to stay within the Government’s target range of 3.0 percent ± 1.0 percentage point for 2019 – 2021. Going forward, the BSP will remain watchful over latest economic developments here and abroad to ensure that the monetary policy stance remains consistent with the BSP’s price stability objective.