Philippine headline inflation accelerates in November

Philippine headline inflation accelerated in the month of November, on rise in ‘housing and utilities’ prices and the waning of supportive base effects. On a year-on-year basis, the consumer price inflation accelerated to 1.3 percent from October’s 0.8 percent.

Sequentially, headline inflation accelerated to 0.3 percent in November from prior month’s 0.2 percent rise. Food prices contributed positively to the sequential rise, in spite of rice and corn prices dropping yet again. Moreover, ‘housing and utilities’ prices rose 0.4 percent sequentially on the back of higher rent and electricity costs. Core inflation stayed the same at 2.6 percent year-on-year in November.

On a year-on-year basis, food and transport prices continued to weigh on the headline print. Annual changes for almost all other components have been more stable. With the previous year’s base effect beginning to fade, inflation is likely to gradually rise from here, noted ANZ in a research report. In line with this, there is some evidence that the number of items with prices rising above 4 percent year-on-year as well as their weights in the basket is now dropping at a slower rate.

“Even so, the rise is unlikely to threaten the BSP’s monetary policy stance. Economic growth is still the key concern of policymakers, despite the breathing room provided by stronger momentum recently”, added ANZ.