Price freeze brings March inflation down to 2.5%

The rise in consumer prices eased to 2.5 percent year-on-year in March due mainly to the price freeze put in place by the government under the nationwide state of calamity amid the COVID-19 pandemic and the decline in the global prices of oil.

The Philippine Statistics Authority (PSA) on Tuesday reported that the rate of increase in prices of basic commodities last month was the slowest so far this year, bringing the first-quarter average to 2.7 percent, within the government’s 2 to 4 percent target range for 2020.

But on a month-on-month basis, average prices in March inched up 0.1 percent, reversing the 0.2-percent decline in February as demand picked up.

Specifically, prices of food and non-alcoholic beverages; alcoholic beverages and tobacco; furnishing, household equipment and routine maintenance of the house, and education rose faster month-on-month as consumers scrambled to buy supplies before and during the one-month enhanced community quarantine imposed in Luzon and other areas in the country that started in mid-March.

In a separate report, National Statistician Claire Dennis S. Mapa attributed the downward trend in the headline annual rate last March mainly to lower year-on-year inflation in transport; housing, water, electricity, gas, and other fuels, and in alcoholic beverages and tobacco.

In particular, transport costs declined 1.8 percent year-on-year last month in line with lower global oil prices.

Also, some food items recorded a decline in prices, such as rice, whose prices dropped 5.8 percent in March, the 11th consecutive month of year-on-year decline.

Corn prices fell 3 percent, while sugar prices went down 1.2 percent.

Prices of meat, cereals, flour, bread and pasta posted slower annual increases last month, but price hikes in fish, oils and fats, fruits and vegetables were faster compared to February.

However, preliminary PSA data showed that the inflation rate for the bottom 30-percent income households picked up to 2.4 percent year-on-year in March from 2.2 percent last February, although lower than the 3.5 percent posted a year ago.

The Bayanihan to Heal as One Act had put in place social amelioration programs to aid vulnerable sectors such as poor families and displaced workers as well as medical front-liners amid the fight against the COVID-19 disease. INQ