PHILIPPINES – Lower food prices, primarily rice and meat, pulled down headline inflation in the Philippines to 2.4 per cent in March 2015 from 2.5 per cent in the previous month and from 3.9 per cent in March 2014, according to the National Economic and Development Authority (NEDA).
“The easing annual growth rate of rice prices was supported by favourable total rice stocks inventory.
“Food inflation could have been lower if not for the relatively higher prices of vegetables and fish, which is due in part to the likely shift in consumers’ preferences given the onset of the Lenten season,” said Economic Planning Secretary Arsenio M. Balisacan.
He added that the slower upward adjustments in food prices also benefited from the firm commitment of local bread producers to cut down the prices of bread as transportation and production costs declined due to cheaper fuel.
Meanwhile, inflation among non-food items rose slightly to 0.9 per cent in March 2015 from 0.6 per cent in the previous month, mainly due to softer declines in the price indices of electricity, gas and other fuels price and operation of personal transport equipment.
On the other hand, core inflation, which excludes selected volatile food and energy prices, inched up to 2.7 per cent in March 2015 from 2.5 per cent in February 2015, albeit slower compared to the 2.8 per cent registered in the same period a year ago. It averaged at 2.5 per cent in January to March 2015.
Overall, headline inflation for the first three months of 2015 averaged 2.4 per cent, which is still within the inflation target range of 2.0 to 4.0 per cent set by the NEDA Board Development Budget Coordination Committee for 2015.
“Inflation remained low and stable in the first three months of the year in line with expectations over the policy horizon, which is likely to support consumption growth,” said Mr Balisacan, who is also NEDA Director-General.
Mr Balisacan said that a relatively stable peso, given the country’s strong external position on the back of strong remittances, rising BPO (Business Process Outsourcing) earnings and FDI (Foreign Direct Investment) inflows, ample international reserves, and a manageable level of external debt contribute to stable domestic prices.
TheMeatSite News Desk