The Finance Department said it expects the inflation rate to slow down to 6.3 percent in November from a nine-year high of 6.7 percent in October.
Finance Undersecretary Gil Beltran, also the department’s chief economist, said in a news briefing that rice and vegetable prices declined, although that of meat was increasing.
“We expect inflation for the month-on-month, it will go down to 0.07 percent, so that year-on-year it should be about 6.3 percent… from 6.7 percent,” Beltran said.
Finance Secretary Carlos Dominguez III said while the impact of the Rice Tariffication bill would be felt next year, the administrative measures that President Rodrido Duterte ordered in the third week of September were in effect already.
Beltran also said he did not expect inflation to be faster than 6.3 percent in December.
The Bangko Sentral ng Pilipinas said inflation in November likely slowed to as low as 5.8 percent from 6.7 percent in October amid the down trend in oil prices and as the supply of rice and other agricultural products stabilized.
The BSP Department of Economic Research said the November 2018 inflation likely settled within a range of 5.8 percent to 6.6 percent.
“The deceleration of inflation for the month could be attributed to the sharp decline in petroleum prices, the normalization of supply conditions in rice and other agricultural commodities, and the peso appreciation,” the BSP said.
The peso has been hovering slightly above the 52-per-dollar level in the past few weeks, stronger than 53 per dollar in the middle of the year.
“These could be offset in part by the adjustments in jeepney and bus fares as well as higher electricity rates in Meralco-serviced areas,” the BSP said.
“Moving forward, the BSP will remain watchful of economic and financial developments to ensure the achievement of its primary mandate of price stability conducive to balanced and sustainable economic growth,” it said.
Inflation in October stayed at 6.7 percent, or the same rate a month ago. This brought inflation in the first 10 months to 5.1 percent, above the target range of 2 percent to 4 percent for the year.
The Monetary Board, the policy-making body of Bangko Sentral ng Pilipinas, on Nov. 15 raised for the fifth time this year the benchmark interest rates by 25 basis points to 4.75 percent to temper the high inflation rate.
This brought the total increase in the policy rates this year to 175 basis points since May 2018. The interest rates on the overnight lending and deposit facilities were raised accordingly.