By Katherine K. Chan, Reporter
PHILIPPINE INFLATION may have accelerated above 8% in October as higher costs of local fuel, electricity and transport fares weighed on the headline print, the Bangko Sentral ng Pilipinas (BSP) said.
In its forecast released on Friday, the central bank said it expects headline inflation to settle between 7.1% and 8.1% in October.
This means the headline clip could accelerate above the 7.2% peak recorded in September and April, and could be the fastest print in nearly four years or since the 8.6% in February 2023.
If the upper end of the forecast holds, inflation will sharply quicken from the 1.7% clip in October last year.
At the bottom end, inflation would ease from September to mark the slowest print since August’s 6.1%.
However, either outcome would keep inflation above the BSP’s 3% target for the eighth month in a row.
The Philippine Statistics Authority (PSA) will release the October inflation report on Nov. 5.
“Upward price pressures are likely to come from higher prices of domestic fuel, electricity, and transport fares,” the BSP said in a statement.
Local fuel retailers had mixed price adjustments this month, with the price of gasoline declining by as much P1.11 per liter and diesel by P0.52 per liter. However, kerosene climbed by up to P4.57 per liter.
At end-October, gasoline cost between P75.10 and P101.10 per liter, diesel at P88 to P102.5 per liter, and kerosene at P116 to P145.34 per liter in Metro Manila and nearby areas.
These remained well above the prewar range of P50 to P60 per liter.
Meanwhile, Manila Electric Co. raised electricity rates by 31.91 centavos per kilowatt-hour (kWh) to P15.0615 from P14.7424 per kWh in September. Its first electricity rate increase in two months translates to a P64 hike in the total electricity bill of households consuming 200 kWh monthly.
The Land Transportation Franchising and Regulatory Board likewise approved fare hikes for all public utility vehicles effective Sept. 28.
However, lower food prices amid “favorable supply conditions” likely offered some relief to the headline print in October, according to the BSP.
“These pressures could be partially offset by lower prices of key agricultural commodities, such as rice, vegetables, meat, and fish, owing to favorable supply conditions,” it said.
Rice prices remained higher than their year-ago levels but eased month on month in the first half of October.
Based on PSA data, the average cost of local regular milled rice rose by 23.86% year on year to P49.79 a kilo from P40.20, but slipped by 0.42% from P50 a month ago.
The price of well-milled rice also went up by 18.86% to P56.22 a kilo from P47.30 a kilo the prior year, but fell by 0.46% from P56.48 a kilo in the first half of September.
“The BSP will remain vigilant and guided by incoming data, particularly on inflation and growth prospects,” the BSP said. “It will continue to assess the impact of the latest developments in the Middle East on the country’s inflation and economic outlook.”
The central bank sees inflation averaging 6.1% by yearend, sharply faster than the 1.7% print in 2025.
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