November inflation drops again to 4.1%

November inflation drops again to 4.1%
SunStar File/Jean Nicole Cortes

THE country’s inflation has further eased to 4.1 percent in November from 4.9 percent in October, following the decline of food and non-food prices during the month.

The November inflation print is the lowest recorded in the past 20 months since March 2022, according to the National Economic and Development Authority (Neda), and is well within the Bangko Sentral ng Pilipinas’ (BSP) forecast range of four to 4.8 percent.

As of November, the year-to-date inflation stood at 6.2 percent, far beyond the two to four percent target of the government.

The Philippine Statistics Authority on Tuesday, Dec. 5, 2023, said the year-on-year growth rate of the heavily weighted food and non-alcoholic beverages slowed down to 5.7 percent in November 2023 from seven percent in October 2023, the primary driver of the lower inflation rate.

This was followed by transport with a 0.8 percent annual decrease from a one percent annual growth in October 2023. The restaurants and accommodation services index with a slower inflation rate of 5.6 percent in November 2023 from 6.3 percent in the previous month also contributed to the downtrend of the overall inflation.

Entrepreneur Steven Yu, former president of the Mandaue Chamber of Commerce and Industry, said the easing of inflation to 4.1 percent is “a good development that will lessen the pressure of the BSP to tighten monetary policy further.”

The central bank during its Nov. 16 meeting kept the interest rates at 6.50 percent.

“A pause in rate hike for the rest of the year is a significant and welcome development for the business community,” he said.

According to Yu, a lower inflation footprint augurs well for the buying public so they stretch their buying capacity, especially this festive Christmas season.

“We expect a spike in buying activities this December, however, the uncertain economic outlook will subdue or temper the momentum. People are cautiously selective in their buying choices preferring lower price alternatives,” said Yu.

Big help to MSMEs

Yu added that the decrease in inflation is effectively providing a lifeline to the struggling micro, small, and medium enterprises, offering them a window of opportunity to recuperate and rebound from a series of cost increases.

Business owners, Yu said, are hoping inflation will continue to decline and stabilize at two to four percent and for the BSP to start cutting rates as early as the second quarter of 2024.

According to the BSP, the latest inflation outturn is consistent with its projections that inflation will likely moderate over the near term due to easing supply-side price pressures and negative base effects.

It said that the balance of risks to the inflation outlook still leans significantly towards the upside.

Key upside risks are associated with the potential impact of higher transport charges, electricity rates, and international oil prices, as well as higher-than-expected minimum wage adjustments in areas outside the National Capital Region.

Meanwhile, the impact of a weaker-than-expected global recovery as well as government measures to mitigate the effects of El Niño weather conditions could reduce the central forecast.

“Looking ahead, the Monetary Board deems it necessary to keep monetary policy settings sufficiently tight until a sustained downtrend in inflation becomes evident,” the central bank said.

Moreover, Neda chief Arsenio Balisacan said the government will need to continue monitoring the inflation situation in the face of continued price pressures coming from geopolitical tensions and extreme weather situations, further fueling uncertainty.


To ensure sufficient supply and stable prices of rice, the Inter-Agency Committee on Inflation and Market Outlook sub-committee on food inflation has proposed to maintain the lower tariff rates on rice, corn and swine meat.

Differentiated support must also be provided to agricultural producers, depending how and when they will be affected by El Niño. Measures to reduce transport and delivery costs are being undertaken as well.

A strong El Niño is already present in the country and is projected to intensify in the coming months until the second quarter of 2024. This could bring below-normal rainfall across the country and disrupt food production and energy generation.


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