March inflation eases to 2-month low of 4.5%

THE Philippines posted its slowest headline inflation rate in two months last March, softening to 4.5 percent, as price growth of food and nonalcoholic beverages slips, the Philippine Statistics Authority reported on Tuesday.
The figure slid from February’s 4.7 percent, but still faster from last year’s 2.5 percent, still within the Bangko Sentral ng Pilipinas’ (BSP) 4.2- to 5-percent forecast range.

The year-to-date consumer price growth averaged 4.5 percent, surpassing the BSP’s 2- to 4-percent range for 2021.

In a briefing, National Statistician Claire Dennis Mapa traced the latest headline inflation to the lower annual pickup in prices of heavily-weighted food and nonalcoholic beverages at 5.8 percent in March from 6.7 percent in February.

Excluding selected food and energy items, core inflation rose by 3.5 percent, a match from February’s 3.5 percent, but a surge from March 2020’s 3 percent. It averaged 3.5 percent in the first quarter of 2021.

Consumer price growth for the bottom 30-percent income households at the national level stayed at a high of 5.5 percent in March.

Last year, inflation for the poorest registered at 2.4 percent. The March figure was the fastest since the 6.3 percent in December 2018.

“The overall latest outturn is consistent with expectations that inflation could settle above the high end of the target in 2021, reflecting the impact of supply side constraints on domestic prices of key food commodities, such as meat, as well as the continuing rise in world oil prices,” BSP Governor Benjamin Diokno commented.

Still, he said, the BSP still sees consumer price growth to return within the target band in 2022 as supply side influences moderate. At the same time, timely and effective implementation of direct measures by the national government could contribute to decelerating price pressures.