February Inflation Slows Down to 2.6 Percent

Year-on-year headline inflation slowed down to 2.6 percent in February from 2.9 percent in the previous month and was within the BSP's expected range of 2.4-3.2 percent for the month. The resulting year-to-date average inflation rate of 2.8 percent was within the Government's target range of 3.0 percent 1.0 percentage point for the year. Likewise, core inflationwhich excludes selected volatile food and energy items to measure underlying price pressures�eased slightly to 3.2 percent in February from 3.3 percent in the previous month. Meanwhile, month-on-month seasonally-adjusted inflation dropped to -0.2 percent in February from 0.5 percent in January.

Food inflation decelerated on slower price increases of meat, fish, and vegetables while rice and corn inflation also remained negative in February. Meanwhile, non-food inflation moderated driven by the decline in electricity rates due to lower generation charges. Furthermore, price rollbacks of domestic petroleum products in February, largely influenced by the lower international price of crude oil, also brought down non-food inflation.

The latest inflation outturn remains consistent with the BSP's prevailing assessment that inflation will settle near the midpoint of the Government's 2-4 percent target range in 2020 and 2021. The BSP will carefully consider all the latest developments here and abroad at its next monetary policy meeting on 19 March 2020. Going forward, the BSP will ensure that the monetary policy stance remains consistent with its primary objective of maintaining price stability that is conducive to a balanced and sustainable growth of the economy.

Source: Bangko Sentral ng Pilipinas (BSP)