(Adds details from the Philippine Statistics Office, central bank)
Philippine headline inflation posted its sharpest drop in two decades in June at 1.2 percent on the back of sufficient food supply and moderate price pressures on energy and oil rates, the latest figures released Tuesday by the National Economic and Development Authority (NEDA) show.
Using 2006 as the current base year, the NEDA said the June figures covered the monthly inflation series from 1995 to June 2015.
Inflation in the month settled within the central bank’s forecast range of between 1.1 percent and 2 percent, and stood below analysts’ estimates of 1.4 percent to 1.8 percent.
Growth in consumer prices decelerated from 1.6 percent in May and 4.4 percent in June last year.
Excluding food and energy prices, core inflation dipped further to 2 percent in June from 2.52 percent in May and from 2.8 percent recorded a year earlier, according to data from the Philippine Statistics Authority (PSA).
From January to June, core inflation averaged 2.3 percent. Including those prices, headline inflation for the year-to-date averaged 2 percent.
Greece, El Nino
The Bangko Sentral ng Pilipinas (BSP) warned that although the year-to-date average inflation settled at the lower end of the government’s 2 percent to 4 percent target range, there are still risks that could provide upside pressure to consumer prices.
“While this out-turn is at the low end of the target range, there remain upside risks of financial market volatility in reaction to developments in Greece and possibility of El Nino later this year that necessitate care in next moves,” BSP Governor Amando Tetangco Jr. said in a text message to reporters following the release of the official June inflation rate.
But Tetangco said the central bank “will continue to monitor developments to see if there is need to make adjustments to our policy levers.”
MAYVELIN U. CARABALLO