The country’s average headline inflation rate for full-year 2014 picked up to 4.1 percent from the 3-percent rate a year earlier but stayed within the 3-percent to 5-percent target range of the central bank, official data showed on Tuesday.
The full-year average also settled within private analysts’ estimates of between 3.8 percent and 4.3 percent.
The Bangko Sentral ng Pilipinas (BSP) reported that it met its inflation target for six consecutive years. The average headline inflation rate for 2014 was also lower than the BSP’s 4.4-percent forecast for the year.
For December alone, headline inflation continued to move at a slower pace of 2.7 percent year-on-year from 3.7 percent in November, as well as the 4.1 percent a year earlier.
The December rate released by the Philippine Statistics Authority (PSA) came within the central bank’s forecast range of between 2.4 percent and 3.2 percent for the month, as well as private analysts’ estimates of between 2.8 percent and 2.9 percent.
Utility rates cooling
The PSA reported lower inflation for housing, water, electricity, gas and other fuels and transport.
The National Economic and Development Authority (NEDA) noted that December 2014 recorded contractions in the price indices of petroleum electricity, gas and other fuels at -8.3 percent from -2.6. percent and operation of personal transport equipment at -6.0 percent from -1.2 percent.
“Electricity rates were lower year-on-year in December 2014 after a decline in generation and transmission charges was noted on the back of improved availability of power plants and lower cost of fuel,” said Socioeconomic Planning Secretary Arsenio Balisacan.
He said Manila Electric Co. (Meralco) charges were down anew in December by 13 percent, equivalent to a reduction of P0.73 per kilowatt hour.
Balisacan, who is also the NEDA director general, further said the sharp decline in Dubai oil prices, which fell to its lowest levels since 2010, translated to lower domestic petroleum prices.
Price reductions were recorded in December for unleaded gasoline prices, diesel, kerosene, and in liquefied petroleum gas or LPG, he added.
Also, the NEDA chief said despite the holiday season, year-on-year food inflation in December 2014 slowed to 5.5 percent from 6.5 percent in the previous month, mainly due to high food prices in the same period of 2013 partly arising from Super Typhoon Yolanda which hit the country in early November.
“The absence of new major economic shocks, which could considerably affect food supply, as well as the normalization of supply chain of other food products in part resulting from the augmentation of rice stocks from imports and the lifting of the expanded truck ban in September 2014, may have also contributed to the decline in inflation in December 2014,” said Balisacan.