Headline inflation for the second quarter of the year eased to 2.6 percent from the 3.2 percent recorded a quarter ago.
In a press briefing, Bangko Sentral ng Pilipinas (BSP) Deputy Governor Diwa Guinigundo announced that the second-quarter inflation figure brought the year-to-date average inflation rate to 2.9 percent. It was also slightly below the government’s 2013 inflation target range of 4 percent plus or minus 1 percentage point.
“This was due mainly to slower nonfood inflation, owing to lower electricity rates and domestic petroleum prices,” he said.
Inflation for most food items was also lower, reflecting adequate domestic supply of rice, corn, fish, milk, oils and sugar.
Also, the BSP official said that the official measure of underlying inflation, along with the alternative measures of core inflation it estimated, was lower in the second quarter of the year than in the previous quarter.
Guinigundo said that it indicated a relative absence of broad-based inflationary pressures. Official core inflation was recorded at 3 percent. Furthermore, the BSP official said that the risks to the inflation are considered to remain evenly balanced.
“Uncertainty over the strength of the global economy is expected to moderate pressures on international commodity prices,” he said.
However, upside risk to inflation could come from additional petitions for adjustments in electricity rates in Mindanao, and the impact of sustained growth in liquidity, he added.
“Meanwhile, indications of firm domestic demand suggest that the domestic economy continues to receive ample monetary stimulus,” Guinigundo said.