MANILA, Philippines – After a 5-month high, the rate of increase of the price of goods and services eased to lower-than-expected 3.2% in March, the National Statistics Office (NSO) said.
March inflation rate was down slightly from February's 3.4%, with other commodity groups pulling down the increased prices of tobacco and alcoholic beverages.
“Lower prices of food (except vegetable), electricity and petrol pulled headline inflation down in March, while uptick in the prices of non-food items, particularly alcohol and tobacco, partially moderated the decrease,” said Arsenio Balisacan, National Economic and Development Authority’s Director General.
The annual price rates of food and non-alcoholic beverages slowed down to 2.8% from 2.9%.
NSO cited that the ample supply of rice, corn, meat, fish, milk and fruits and lower prices of the other commodities was enough to moderate inflation.
Lower cost of non-alcoholic beverages, household expenses, transportation and communication also contributed to the month’s lower new numbers.
NEDA said, “Prices of non-food items, particularly electricity and petrol as well as operation of personal transport equipment, declined in March 2013. This is attributed to the reduction in Manila Electric Company’s (MERALCO) generation charge last month and the cheaper retail prices of domestic petroleum products.”
Tobacco and alcoholic beverages went up to 31.5% from 29% and clothing and footwear to 4.9% from 4.8%.
Growth of consumer prices in March was lower compared to the previous month, although still higher against the 2.6 percent inflation recorded in March 2012. Prices rose early this 2013 following the implementation of the sin tax law.
To be expected
“However, the upside inflationary pressure coming from election spending still needs to be factored in. Inflation is nevertheless seen to remain manageable as a strong peso will temper any upside inflationary pressure," Ty-led Metrobank said in a report.
The full-year target is 3.6%.
Balisacan stressed that the Philippines' inflation rate in March remained lower than Indonesia (5.9%) but higher compared to Thailand (2.69%).
“Average inflation rate for the first three months of 2013 remained at 3.2%, well within the Development Budget Coordination Committee’s inflation target of 3% to 5.0% for 2013,” said Balisacan - Rappler.com