Inflation, or the average annual increase in consumer prices, rose to a fresh nine-year high of 6.7 percent in September from 6.4 percent in August, the Philippine Statistics Authority (PSA) announced on Friday, October 5.
It now stands more than triple the average inflation of 2.2 percent in five other large member-countries of the Association of Southeast Asian Nations (ASEAN), namely, Indonesia, Malaysia, Thailand, Singapore and Vietnam. At the start of the year, the gap was much smaller. (See infographic)
The Philippines’ headline inflation rate has been on a continuous rise for the past nine months straight, prompting the Bangko Sentral ng Pilipinas (BSP) to implement measures to stem the surge in prices. Most recently, it raised rates on its overnight reverse repurchase facility in September to 4.5 percent, laying the ground for higher rates on loans such as credit cards in the next few months.
“The uptrend was primarily brought about by the heavily-weighted food and non-alcoholic beverages index which further accelerated to 9.7 percent in September 2018,” the PSA explained in a statement.
The increase in consumer prices can be traced primarily to a surge in rice prices brought about by importation delays in recent months. Higher prices of oil in the world market also contributes to higher inflation, worsening the impact of higher excise taxes on fuel products that took effect in January.
Among the commodity groups that saw higher inflation rates in September are alcoholic beverages and tobacco (21.8 percent), clothing and footwear (2.5 percent), furnishing, household equipment and routine maintenance of the house (3.6 percent), health (4.1 percent), transport (8.0 percent), communication (0.5 percent) and recreation and culture (3.0 percent).
Only the housing, water, electricity, gas and other fuels index recorded a decline in inflation rate to 4.6 percent. The education and restaurant and miscellaneous goods sectors, on the other hand, remained stable at previous month’s annual rates at -3.8 percent and 4.0 percent, respectively.
While inflation rate in Metro Manila eased to 6.3 percent from 7.0 percent in September, price increases in all other 16 regions climbed to an average of 6.8 percent from 6.2 percent.
Bicol Region recorded the fastest acceleration at 10.1 percent. This is followed by the Autonomous Region in Muslim Mindanao (ARMM) at 9.0 percent, and Ilocos Region—which was devastated by Typhoon Ompong in September—at 8.6 percent.
Pauline Macaraeg is Entrepreneur PH's data journalist. Follow her on Twitter @paulinemacaraeg