Philippine Inflation Rate Stays at 3.2 Percent

The Philippines average inflation rate in 2012 decelerated to 3.2 percent from 4.6 percent the previous year.

The Philippines inflation rate averaged 9.1 percent reaching an all time high of 62.8 percent in September of 1984 and a record low of -2.1 percent in January of 1959.

Bangko Sentral ng Pilipinas (BSP) Governor Amando M. Tetangco, Jr.said resulting year-to-date average inflation rate of 3.2 percent remains well within the Government’s inflation target range of 3-5 percent for 2012.

This is the fourth consecutive year that inflation stayed within the government’s target range, he added.

He said BSP will continue to keep a close watch on emerging price and output conditions to ensure that monetary policy settings remain consistent with the price stability mandate while being supportive of non-inflationary growth.

“This, together with the expectation that real GDP growth would continue to be strong suggest our current policy settings are appropriate,” he explained.

Last December, the central bank’s policy-making Monetary Board (MB) maintained the BSP’s policy rates after noting the strong growth of the domestic economy.

Thus, the overnight borrowing rate remains at record-low 3.5 percent and overnight lending rate at 5.5 percent.

In the first three quarters,the economy grew, as measured by gross domestic product (GDP), by 6.5 percent surpassing the government’s five to six percent target for the year.

He cited growth prospects in the advanced economies and China and any geopolitical developments in the Middle East as among the factors that may affect domestic inflation.

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