The Market Monitor Minding the Nation's Business
Headline inflation was quickest in nearly four years in October as high energy costs spilled over to transport, utilities, and restaurant services, the Philippine Statistics Authority (PSA) said on Thursday.
The headline figure, as measured by the consumer price index, accelerated to 7.8% from 7.2% in September and 1.7% a year ago. This was the highest since February 2023’s 8.6%.
It also marked this year’s peak so far, exceeding the 7.2% recorded in April and September.
October inflation was within the Bangko Sentral ng Pilipinas’ (BSP) 7.1%-8.1% forecast.
The headline clip remained above the BSP’s 3% target for an eighth straight month, bringing the year-to-date average to 5.6%.
National Statistician Claire Dennis S. Mapa said October inflation heated up due to faster inflation in transport, housing and utilities, as well as restaurants and accommodation services.
Transport inflation sizzled to a six-month high of 20.1% last month from 14.6% in September. Of this, gasoline inflation quickened to 51.1% (from 40.9%), while diesel inflation rose to 62.4% (from 61.3%).
Oil price adjustments were mixed in October. The price of gasoline fell by up to P1.11 a liter and diesel by P0.52 a liter, while kerosene rose by as much as P4.57 a liter.
As of end-October, the per liter price of gasoline ranged between P75.10 and P101.10, diesel between P88 and P102.50, and kerosene between P116 and P145.34 in Metro Manila and nearby areas.
Mapa likewise noted that the public transport fare hike imposed in late September drove up inflation for other passenger transport by road to an over three-year high of 11.6% in October from 5.4% in September.
“Our October inflation rate was really affected by the transport fare hike,” he told a press briefing. “It did not have an impact (in September) because it was implemented only around the last two days of September, but it really had an impact this October… This will continue into November and December because of the base effect.”
Meanwhile, inflation for housing, water, electricity, gas and other fuels came in faster at 9.3% in October from 8.4% a month earlier.
Dining out also became more expensive last month, with inflation for restaurants and accommodation services picking up to 7.7% from 7% in September.
Mapa noted that this was largely due to second-round effects of elevated costs of energy, food, and raw materials, as well as the recent minimum wage hike in the National Capital Region.
On Sept. 26, the minimum wage in NCR was raised by P60, bringing nonagricultural workers’ daily pay to P755 and those for agricultural workers and employees of retail, service, and small manufacturing establishments to P718.
On the other hand, food inflation slowed in October, partly offsetting the increases in other commodity groups. Inflation for the heavily weighted food and nonalcoholic beverages index eased to 6.1% in October from 6.7% in the prior month.
The Department of Economy, Planning, and Development said in a statement that improved food supply helped temper price pressures in October. Favorable weather conditions helped cool down food inflation during the month, it added.