Philippines Annual Inflation Accelerates In September

Oct 5, 2007 - Philippines annual inflation accelerated to 2.7% in September from 2.4% in August, the National Statistics Office said Friday. Consumer prices rose more than the expected growth of 2.6%. However, inflation remained with in the central bank's expectations of 2.1% to 2.8%.

Core inflation, excluding food and energy items, eased to 2.7% in September from 2.9% recorded in the prior month.

On a monthly basis, consumer prices climbed 0.1% in September, the same rate registered in August. Inflation averaged 2.6% for the first nine months of the year.

Higher prices of food, beverages and tobacco and prices of services item contributed to annual increase in the inflation rate in September. Food, beverages and tobacco charges climbed at a faster pace of 3.5% and service charges were up 2.4%. Meanwhile, inflation for clothing eased to 2.0% and fuel, light and water prices slowed to 2.3%.

Compared to previous month, food, beverages and tobacco charges moved up 0.7%, while price increments in clothing decelerated to 0.1%. Prices of fuel, light and water fell 2.3% and housing and repair charges showed a zero growth rate.

The inflation numbers came a day after the central bank lowered the key overnight borrowing rate or Reverse Repo Rate, by 25 basis points to 5.75%. The overnight lending or repurchase rate, RP was also reduced by a similar margin to 7.75%. This was the second time that the policy rates were adjusted this year, after the central bank slashed the RRP rate by 150 basis points in July, while removing the tiering system.