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Trade Outlook
November 2019 Inflation Update: Edging Up
December 04, 2019 09:40

The consumer price index edged up in October 2019. On a monthly basis, consumer prices rose by 0.02% (mom) when compared to the previous month when there was deflation of 0.27% (mom). The monthly inflation is below our estimate of 0.16% (mom) and the median market expectations of 0.17%. It is also lower compared to the inflation in October 2018 (+0.28% mom), but 0.01 points higher than the monthly inflation back in October 2017 (+0.01% mom).

Annually, consumer prices in October 2019 (+3.13% yoy) increased at a slower pace compared to the previous month (+3.39% yoy). Prices in the non-food component rose by 0.05% (mom) but fell in the food component (-0.02% mom).

Compared to September 2019, inflation in October 2019 was driven by increases in the prices in the prepared foods, beverages and cigarettes component (+0.45% mom), although mitigated by deflation in the foodstuffs group (-0.41% mom) and the transportation and communications component (-0.08% mom). The commodities that contributed to inflation in the prepared foods, beverages and cigarettes component were rice and side dishes, as well as cigarettes. The adjustment in excise tax rates on tobacco products triggered an increase in excise tariffs and higher retail prices of some types of tobacco product. Meanwhile, the price increases in other components were relatively small. Foodstuffs such as red chilis, cayenne peppers, and chicken eggs experienced deflation while the prices of purebred chickens and shallots experienced inflation.

Meanwhile, prices in the healthcare component rose by 0.30% and contributed 0.01% to inflation, while prices in the housing component rose by 0.08% mom, 0.08% mom in the clothing component and by 0.10% mom in the education component.