Inflation was pulled down to 1.3 percent in January owing to the slower price adjustments in both food and non-food items, the National Economic and Development Authority (NEDA) said Friday.
The latest number noted a decrease from the 2.4 percent in January 2015 and a slight slowdown from the 1.5 percent the previous month, as inflation for the food subgroup decreased following the stabilization of prices of fish, fruits, vegetables, milk, cheese, and eggs.
"Good weather conditions at the onset of 2016 allowed prices of these food items to stabilize. This was an improvement from the previous month when Typhoon Nona pushed up prices due to hampered production, transport, and delivery of agricultural products in the affected areas," newly-appointed Socioeconomic Planning Secretary Emmanuel F. Esguerra said in an emailed statement.
January's inflation figure was also in line with the central bank's forecasted inflation range of 0.8 to 1.6 percent, exactly the same as the median forecast.
In terms of non-food items, inflation likewise showed a deceleration across all commodity groups, with transport having the biggest change.
"Domestic prices of petrol -- gasoline, liquefied petroleum gas (LPG), diesel, and gasoline -- continued to go down. This was still due to persistent global oversupply and record stockpile of crude oil which weakened prices of Dubai oil, Brean, and West Texas Intermediate (WTI)," Esguerra said.
The month of January also saw a price reduction in electricity on the back of lower generation costs.
Core inflation, on the other hand, eased to 1.8 percent in January from the 2.1 percent in December. This excludes price sensitive food and energy items.
Despite this, NEDA noted the continued risk of higher food prices brought about by waning farm output.
"While it is noted that El Niño will gradually weaken beginning next month, the onset of the summer season may constrain farm output," Esguerra said.
According to Esguerra, the government has already concerted its efforts to mitigate this under the Roadmap for Addressing the Impact of El Niño (RAIN) and avoid supply disruptions.
"Such developments could adversely affect overseas Filipino workers as the governments of the said economies implement austerity measures, cut back on subsidies, postpone infrastructure outlays, and raise taxes," he said.
"The government should actively extend assistance to displaced workers, including re-training, livelihood, re-integration or placement services," he added.