November inflation slows to 6%

Inflation eased to a four-month low of 6 percent in November as average consumer prices that month declined compared to levels in October.

National Statistician Lisa Grace Bersales told a press briefing on Wednesday that the month-on-month inflation rate last month declined by 0.3 percent.

It was the first time since February 2016 that prices dropped compared to the previous month. In February 2016, the month-on-month deflation was 0.2 percent.

Year-on-year inflation in November was the lowest since the 5.7 percent in July.

Among major commodity groups, the increase in prices of food and nonalcoholic beverages slowed to 8 percent year-on-year last month from 9.4 percent a month ago.

The food index eased to 7.7 percent from 9.2 percent in October as the Philippine Statistics Authority noted the slower annual increments in the prices of rice, corn, meat, fish, fruits, vegetables as well as sugar, jam, honey, chocolate and confectionery.

Meanwhile, prices of housing, water, electricity, gas and other fuels rose 4.2 percent year-on-year in November, lower than October’s 4.8 percent.

International crude prices have fallen of late, while the government addressed food supply constraints through administrative orders issued by President Duterte to ease importation.

However, headline inflation during the first 11 months averaged 5.2 percent, staying above the government’s target range of 2-4 percent.

The rate of increase in prices of basic commodities hit more than nine-year highs of 6.7 percent year-on-year in September and October due to skyrocketing global oil prices as well as domestic food price pressures, especially due to meager rice supply, during  that time.

Core inflation, which excludes food and energy items, further rose to 5.1 percent in November from 4.9 percent a month ago and 2.4 percent a year ago.

The economic team welcomed the “marked slowdown” in headline inflation, which it attributed to “the efficacy of anti-inflationary measures taken by the government.”

In a joint statement, Budget Secretary Benjamin Diokno, Finance Secretary Carlos Dominguez III and Socioeconomic Planning Secretary Ernesto Pernia said the November inflation data pointed to “continuing reduction going forward” such that the rate “will stabilize further in the near term.”

As food and nonalcoholic beverages remained the top inflationary drivers, the economic managers said “mitigating measures under various government issuances, including those prescribed in Administrative Order No. 13, issued by the President should be continuously implemented and strictly monitored.”

“Most importantly, we must ensure the timely arrival of rice imports to compensate for the lost palay harvest in the third quarter of the year,” they added.