Philippine Inflation Unexpectedly Slowed in September on Fuel
Philippine inflation unexpectedly slowed in September as fuel prices eased, increasing scope for the central bank to cut borrowing costs further to shield growth.
Consumer prices rose 3.6 percent from a year earlier, after a 3.8 percent advance reported earlier for August, the National Statistics Office said in Manila today. The median estimate in a Bloomberg News survey of 14 economists was for a 3.8 percent gain.
Bangko Sentral ng Pilipinas has room to ease monetary policy should external conditions deteriorate, Governor Amando Tetangco said in September after holding the benchmark interest rate at a record-low 3.75 percent. Policy makers meet later this month to gauge the need for more stimulus measures after the Asian Development Bank cut its growth estimates for the region for this year and next.
“Inflation is still well-behaved and will be within the central bank’s target,” Marc Bautista, head of research at Metropolitan Bank & Trust Co. in Manila, said before the report. “BSP might even cut rates if they see inflation expectations are not that high.”
The peso climbed 0.2 percent to 41.39 per dollar as of 9:12 a.m. in Manila, according to Tullett Prebon Plc.
The central bank targets inflation to average 3 percent to 5 percent in 2012 and 2013. Policy makers next meet on Oct. 25.
Fuel, electricity and water prices climbed 4.5 percent last month from a year earlier compared to a 5.6 percent pace in August, according to today’s release. Clothing and footwear costs rose 5 percent.
The $225 billion economy expanded 5.9 percent last quarter and 6.1 percent in the first half of the year, according to government data. The ADB forecast Asia excluding Japan will grow 6.1 percent this year, the slowest pace since 2009.
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