Inflation, or the annual increase in consumer prices, is expected to ease in October from 6.1 percent registered in September despite the latest round of fuel price hikes, an economist said Monday.
“My inflation estimate for the month of October 2023 [is] 5.6 percent year-on-year,” Rizal Commercial Banking Corp. chief economist Michael Ricafort said in a Viber message.
“[It is] slower versus the 6.1 percent in the previous month, primarily due to higher base/denominator effects a year ago that mathematically leads to slower year-on-year headline inflation starting Q4 2023,” Ricafort said.
Ricafort said the relatively better weather condition in October compared to late July to September could have helped stabilize prices of vegetables and other agricultural products.
“The harvest season from mid-September 2023 to October 2023 that increased local palay/rice supply could have also helped stabilize or even helped ease local palay and rice prices, which accounts for nearly 9 percent of the CPI basket,” Ricafort said.
Ricafort also downplayed the impact of the scheduled fuel price hikes effective Oct. 24, 2023.
An official of the Department of Energy Oil Industry Management Bureau, director Rodela Romero, said the increase could be traced to a decline in US crude stockpiles and Iran’s call on members of the Organization of Islamic Cooperation to impose an oil embargo and other sanctions on Israel.
“[It is] relatively stable/tempered so far,” Ricafort said.
Shell Pilipinas said in a statement that effective 6 a.m. Tuesday, the price of gasoline would increase by P0.95 per liter; kerosene, P1.25 per liter; and diesel P1.30 per liter. Caltex also announced the same rate of increase for gasoline, kerosene and diesel effective 12:01 a.m. Tuesday.
Moody’s Analytics, a unit of Moody’s Corp., earliersaid the Bangko Sentral ng Pilipinas might continue keeping the benchmark policy interest rate steady at 6.25 percent in its November meeting despite the elevated inflation in the past months.
The BSP hiked interest rates by a total of 425 basis points to rein in inflation before pausing in the last four meetings.
