PHL inflation slows in March

Headline inflation eased in March following five consecutive months of picking up, the government’s statistical agency reported earlier this morning.

Preliminary data from the Philippine Statistics Authority (PSA) showed headline inflation at 4.5{0018ee5a413206d5867d4650a6cb0bf5e2f9c77ab1c1dc5336e75263ef8a33b4} in March, slowing from the year-on-year rate 4.7{0018ee5a413206d5867d4650a6cb0bf5e2f9c77ab1c1dc5336e75263ef8a33b4} in February. However, this was still above the 2.5{0018ee5a413206d5867d4650a6cb0bf5e2f9c77ab1c1dc5336e75263ef8a33b4} recorded in March last year.

The latest headline figure is lower than the 4.8{0018ee5a413206d5867d4650a6cb0bf5e2f9c77ab1c1dc5336e75263ef8a33b4} median in a BusinessWorld poll conducted late last week and falls within the 4.2{0018ee5a413206d5867d4650a6cb0bf5e2f9c77ab1c1dc5336e75263ef8a33b4}-5{0018ee5a413206d5867d4650a6cb0bf5e2f9c77ab1c1dc5336e75263ef8a33b4} estimate given by the Bangko Sentral ng Pilipinas (BSP) for March.

Year-to-date inflation settled at 4.5{0018ee5a413206d5867d4650a6cb0bf5e2f9c77ab1c1dc5336e75263ef8a33b4}, still within the BSP’s 2-4{0018ee5a413206d5867d4650a6cb0bf5e2f9c77ab1c1dc5336e75263ef8a33b4} target this year, but above the forecast of 4.2{0018ee5a413206d5867d4650a6cb0bf5e2f9c77ab1c1dc5336e75263ef8a33b4} for the entire year.

Core inflation, which discounted volatile prices of food and energy items, stood at 3.5{0018ee5a413206d5867d4650a6cb0bf5e2f9c77ab1c1dc5336e75263ef8a33b4}. This was unchanged from the rate recorded in the previous month, but faster than the 3{0018ee5a413206d5867d4650a6cb0bf5e2f9c77ab1c1dc5336e75263ef8a33b4} in the same month last year.

The PSA attributed the easing in March to the slower increase in prices of heavily-weighted food and non-alcoholic beverages at 5.8{0018ee5a413206d5867d4650a6cb0bf5e2f9c77ab1c1dc5336e75263ef8a33b4} from 6.7{0018ee5a413206d5867d4650a6cb0bf5e2f9c77ab1c1dc5336e75263ef8a33b4} in February. Food and non-alcoholic beverages account for 38.3{0018ee5a413206d5867d4650a6cb0bf5e2f9c77ab1c1dc5336e75263ef8a33b4} of the theoretical basket of goods that an average Filipino household consumes.

The PSA also noted faster annual rates in alcoholic beverages and tobacco (12.1{0018ee5a413206d5867d4650a6cb0bf5e2f9c77ab1c1dc5336e75263ef8a33b4} from 12.2{0018ee5a413206d5867d4650a6cb0bf5e2f9c77ab1c1dc5336e75263ef8a33b4} in February); furnishing, household equipment and routine maintenance of the house (1.9{0018ee5a413206d5867d4650a6cb0bf5e2f9c77ab1c1dc5336e75263ef8a33b4} from 2.4{0018ee5a413206d5867d4650a6cb0bf5e2f9c77ab1c1dc5336e75263ef8a33b4}); communication (0.2{0018ee5a413206d5867d4650a6cb0bf5e2f9c77ab1c1dc5336e75263ef8a33b4} from 0.3{0018ee5a413206d5867d4650a6cb0bf5e2f9c77ab1c1dc5336e75263ef8a33b4}); and restaurant and miscellaneous goods and services (3.1{0018ee5a413206d5867d4650a6cb0bf5e2f9c77ab1c1dc5336e75263ef8a33b4} from 3.2{0018ee5a413206d5867d4650a6cb0bf5e2f9c77ab1c1dc5336e75263ef8a33b4}).

Meanwhile, the inflation rate for the bottom 30{0018ee5a413206d5867d4650a6cb0bf5e2f9c77ab1c1dc5336e75263ef8a33b4} of income households stood at 5.5{0018ee5a413206d5867d4650a6cb0bf5e2f9c77ab1c1dc5336e75263ef8a33b4} in March, steady from the rate recorded in the previous month, but still faster than the 2.4{0018ee5a413206d5867d4650a6cb0bf5e2f9c77ab1c1dc5336e75263ef8a33b4} in March 2020.

The inflation rate for the bottom 30{0018ee5a413206d5867d4650a6cb0bf5e2f9c77ab1c1dc5336e75263ef8a33b4} takes into account the spending patterns of this income segment. Thus, its consumer price index differs from that of the average household with the former assigning heavier weights on necessities. — Ana Olivia A. Tirona

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