April Inflation Reaches 4.1%

Manila—(PHStocks)—Bangko Sentral ng Pilipinas (BSP)—Headline inflation increased to 4.1 percent year-on-year in April 2014 from 3.9 percent in March, and was within the BSP’s forecast range of 3.6-4.5 percent for the month. This brought the year-to-date average inflation rate to 4.1 percent, within the Government’s inflation target range of 4 percent ±1 percentage point for 2014.

Core inflation—which excludes certain food and energy items to better capture underlying price pressures—rose slightly to 2.9 percent in April from 2.8 percent in the previous month. On a month-on-month seasonally-adjusted basis, the consumer price index went up by 0.2 percent.

The higher April headline inflation rate was driven largely by the higher prices of food, electricity, and domestic petroleum products. Food inflation accelerated as the prices of all food items, except fruits and vegetables, rose due to some tightness in domestic supply conditions. Similarly, non-food inflation increased as a result of higher gasoline and diesel prices and the upward adjustment in electricity rates, due, in turn, to higher generation charges at the Wholesale Electricity Spot Market (WESM) and increased demand for power with the onset of the summer season.

Officer-In-Charge Nestor A. Espenilla, Jr. said that the April inflation reading continues to support the BSP’s assessment of a manageable inflation environment over the policy horizon. Going forward, the BSP will remain guided by its primary objective of maintaining price stability along with safeguarding the resilience of the financial system. The BSP stands ready to deploy appropriate measures as needed to ensure sustainable, non-inflationary, and inclusive economic growth.