Inflation, or the sustained increase in the price of goods and services, continue to be subdued and well within the government target in the third quarter, Bangko Sentral ng Pilipinas (BSP) Governor Benjamin Diokno announced on Friday.

“Headline inflation declined further to 1.7 percent (year-on-year) in the third quarter 2019 from 3 percent in the previous quarter, bringing year-to-date inflation at 2.8 percent, well within the national government’s target range,” Diokno said.

According to him, the improved food supply, owed primarily to the reforms in rice importation, as well as downward adjustments in generation charges, contributed to easing price pressures and the low inflation number.

“Moreover, weaker demand for oil amid uncertainties surrounding the external environment, particularly the protracted trade tensions between the US and China, dampened global oil prices,” he quickly added.

The BSP chief then noted that core inflation in the third quarter, which stood at just 2.9 percent versus 3.4 percent in the second quarter this year, suggests that there is sustained easing in the demand-side pressures.

Latest inflation figure, which averaged 0.9 percent in September was owed to so-called base effects as price pressures peaked in the same month last year.

BSP Deputy Governor Francisco Dakila Jr. said inflation in October could be lower, given the downtrend observed this year.

“(We) don’t have the official forecast yet but coming from the pattern of inflation that we saw last year, September and October were the high points and therefore, just because of the base effects, we’ll see that the impact of the high inflation last year will be to lower the inflation rates,” Dakila said.