The Philippines – The inflation rate eased more than expected in October, signaling a potential turning point in the country’s battle against the rapid price rises that have squeezed consumers and challenged policymakers this year.
The Philippine Statistics Authority reported that the overall inflation rate fell to 4.9 percent last month from 6.1 percent in September, a drop that outpaced the central bank’s projections of 5.1 to 5.9 percent. This decline brought the year-to-date inflation average to 6.4 percent, edging closer to the government’s forecast range but still exceeding the official target.
Finance Secretary Benjamin E. Diokno attributed the cooling inflation to the government’s “decisive and timely actions,” underscoring President Ferdinand R. Marcos Jr.’s commitment to preserving the purchasing power of Filipino households.
The easing of inflation was primarily driven by a slower increase in the cost of food and non-alcoholic beverages, as well as restaurant and accommodation services. Food inflation, in particular, saw a significant deceleration, with rice — a staple in the Filipino diet — showing a marked decrease in price increase due to a stabilization of supply at the onset of the harvest season.
Non-food inflation remained within the government’s comfort zone, with notable contributions from the service sector, housing rentals, and personal care. However, transport inflation persisted, partly due to fare hikes for public vehicles and a slower decline in fuel prices.
Core inflation, which strips out volatile food and energy prices, also continued its downward trend, offering a glimmer of hope that underlying economic pressures might be starting to ease.
The capital region of Manila mirrored the national trend with a drop in inflation, though some areas like the Central Visayas bucked the trend with higher rates.
To sustain the momentum, the Marcos administration has implemented a series of measures aimed at curbing price pressures. These include intensified monitoring of market behavior, strategic use of the Rice Competitiveness Enhancement Fund to boost agricultural productivity, and targeted financial assistance programs for the most vulnerable sectors.
The government is also taking steps to address non-food inflation through energy and water supply management, wage and fare reviews, and the suspension of certain fees for delivery trucks.
In a move to counteract oil price inflation, officials are considering revising ethanol blend requirements for gasoline, potentially reducing fuel costs. Furthermore, the Department of Finance is backing amendments to the upcoming budget to allow more flexible responses to fuel subsidies for the transport sector.
As the country grapples with the second-round effects of toll rate increases, the administration is advocating for exemptions for trucks carrying agricultural products to prevent further food price escalations.
Secretary Diokno emphasized the government’s vigilance in monitoring inflationary trends, ensuring that policy responses are timely and effective in shielding the economy from further shocks.