Inflation accelerates to 2.9 percent in October

CEBU, Philippines — After reaching the lowest inflation rate of the year in September, inflation in Central Visayas accelerated to 2.9 percent in October, the Philippine Statistics Authority in Central Visayas (PSA-7) reported yesterday.

This brought the average year-to-date inflation rate from January to October to 3.3 percent.

The October inflation rate this year is 1.2 percent lower than the 4.1 percent recorded in October last year.

PSA-7 Regional Director Engr. Ariel E. Florendo noted that the main driver of the accelerated inflation rate is the Food and Non-Alcoholic Beverages index, which stands at 4.4 percent, contributing 75.9 percent to the overall uptrend.

The increase in this index was driven by cereals and cereal products, which posted an inflation rate of 9.2 percent; vegetables and tubers at -3.0 percent; and fish and other seafood at -1.0 percent.

Florendo also highlighted that the transport category significantly contributed to the uptrend, accounting for 24.1 percent of the overall inflation rate. Within this category, passenger transport by sea rose to 14.3 percent in October from -15.1 percent in September, while fuels and lubricants increased to -13.2 percent in October from -15.8 percent in September.

The primary contributors to regional inflation were Food and Non-Alcoholic Beverages, with a 59 percent share, and Housing, Water, Electricity, Gas, and Other Fuels, with a 30.6 percent share.

Additionally, the top five contributors to the October inflation rate by commodity were rice at 8.8 percent, potatoes at -35.4 percent, eggplants at 16.9 percent, electricity at 10.6 percent, and rentals at 2.4 percent.

Food inflation in the region also rose, reaching 4.6 percent in October from 2.1 percent in September. This increase was primarily driven by the faster inflation rate of corn, which jumped to 18.1 percent from 0.9 percent the previous month; rice, which rose to 8.8 percent in October from 5.4 percent in September; and fruits and nuts, which accelerated to 12.6 percent in October from 11.6 percent in September.

Breaking down the inflation rates in the provinces and highly urbanized cities (HUCs) of Central Visayas: Bohol increased from 1.6 percent in September to 2.9 percent in October; Cebu rose to 2.8 percent in October from 0.7 percent in September; Negros Oriental saw an increase to 2.0 percent from 1.5 percent in September; and Cebu City went up to 4.2 percent from 3.9 percent in September.

Conversely, areas that experienced a slowdown in inflation rates included Siquijor at 1.6 percent; Lapu-Lapu City at 2.6 percent; and Mandaue City at 5.4 percent.

Florendo noted that weather disturbances might have contributed to the increase in October’s inflation rate.

“Usually, when it comes to weather disturbances and calamity, naa jud nay follow nga increase pud especially if ma damage pud ni atong mga crops and agricultural products,” said Florendo.

In addition, the National Economic and Development Authority (NEDA)-7 Chief Economic Development Specialist, Architect Neil Andrew U. Menjares emphasized the importance of controlling inflation to maintain economic stability and purchasing power for families.

Menjares highlighted how high inflation erodes household purchasing power and increases borrowing costs for businesses, slowing down economic activity.

While inflation saw a slight increase this October, Menjares pointed out that the current rate remains within the government’s target range, lower than the rates last year.

“Inflation has already gone down comparatively and although it has increased a bit this October, it is still within our target range of two to four percent,” said Menjares.

Furthermore, Menjares emphasized that maintaining inflation within this range is a top priority to prevent economic overheating as well as the risks associated with deflation.

“We also don't want deflation, the negative side of inflation, the decrease in prices. Although at first glance, it looks good, it can also be a sign of recession or contraction of the economy,” he added. — /LPM (FREEMAN)