In September, the inflation rate in the Philippines increased, leading to the possibility of another interest rate increase.

The Philippine statistics agency reported that inflation in Manila rose for the second consecutive month in September, driven by higher food and transportation prices. This may lead to additional interest rate increases by the central bank.

In September, the consumer price index increased to 6.1%, exceeding the expected 5.3% forecast in a Reuters poll. It also reached the upper limit of the central bank’s projected range of 5.3% to 6.1% for the month.

This increased the average inflation for the year to 6.6%, which is still above the central bank’s target range of 2% to 4%.

The rate of core inflation, which excludes volatile food and fuel prices, decreased from 6.1% in August to 5.9%.

Prior to Thursday’s data release, Philippine President Ferdinand Marcos Jr. removed the limit on the cost of rice, which is a key food source in a nation that heavily relies on imported supplies of the crop.

ING’s economist, Nicholas Mapa, stated on platform X that the central bank is likely to increase interest rates in the near future due to inflation exceeding expectations.

The upcoming meeting of the central bank is scheduled for November 16. In its previous two meetings, the bank has maintained stable interest rates, but has not ruled out the possibility of raising them in order to meet its inflation goal for the year.

The economic planning agency announced on Thursday that they will propose an extension of the reduced rice tariff rates until December 2024.