By Anna Leah Gonzales | Philippine News Agency
The country’s headline inflation decelerated to 3.7% in June from 3.9% in May due to the easing of energy and transport costs, the Philippine Statistics Authority (PSA) said.
In a press briefing on Friday, Civil Registrar General and National Statistician Usec. Dennis Mapa said inflation in June last year was higher at 5.4%.
Year-to-date headline inflation was at 3.5%, well within the government’s 2% to 4% target.
Mapa said the downtrend in the overall inflation in June was primarily influenced by the slower annual increment of housing, water, electricity, gas, and other fuels at 0.1% from 0.9% in May.
The sharper deflation in electricity, recorded at -13.7% from -8.5% in May, significantly contributed to the slowdown.
Transport inflation, likewise, decelerated to 3.1% from 3.5% due to lower inflation rates in personal transport and gasoline.
Restaurants and accommodation services with 5.1% inflation in June, down from 5.3% in the previous month, also contributed to the lower inflation.
Food inflation rose to 6.5% from 6.1% in May due to higher prices of vegetables, meat, and corn.
Rice inflation, however, already slightly eased to 22.5% from 23% in May due to the reduction in the prices of well-milled rice.
“Medyo may malaki tayong reduction… mga 20 centavos per kilo doon sa well-milled rice kaya may -0.2 percent reduction tayo diyan for that particular commodity kaya nagkaroon tayo ng slight reduction in the overall inflation,” Mapa said.
“The one that contributed in terms of prices basically is the price for the well-milled rice,” he added.
He said the average price per kilogram of well-milled rice went down to P55.96 from P56.06 in May.
In a statement, the National Economic and Development Authority (NEDA) assured the public that the government is committed to addressing the issue of rising food prices and ensuring food security.
“We are committed to maintaining the country’s inflation rate within our target range of 2 (percent) to 4 percent. The easing in our inflation rate in June, mainly due to lower electricity rates, highlights the importance of strengthening our energy sector to sustain our gains,” NEDA Sec. Arsenio Balisacan said.
“We will continue to work closely with the government, stakeholders, and other priority sectors to implement necessary measures to ensure that the country will have a sufficient and affordable food supply—including rice—for every Filipino,” Balisacan said.
The Development Budget Coordination Committee (DBCC) also earlier committed to implementing monetary policy measures and well-targeted government interventions that address the primary drivers of inflation.
“This includes implementing the new Comprehensive Tariff Program for 2024-2028 to improve the affordability of essential commodities amid the rising global prices, and the Food Stamp Program to mitigate the impact of elevated food prices on the poor and vulnerable sector,” the DBCC said in a statement.
President Ferdinand R. Marcos Jr. earlier issued Executive Order (EO) 62, which modified the tariff rates on various products to ensure a continuous supply of goods and to protect the purchasing power of the Filipino people.
The rice tariff, in particular, was reduced to 15% from 35%.
Medium-term inflation path
In a separate statement, the Bangko Sentral ng Pilipinas (BSP) said the June inflation of 3.7% is within its forecast range of 3.4% to 4.2%.
“The latest inflation outturn is consistent with the BSP’s latest outlook that inflation will settle within the target range for 2024-2025 with inflation expectations remaining well-anchored,” it said.
The BSP noted that the balance of risks to the inflation outlook shifted to the downside for 2024 and 2025 due largely to the impact of lower import tariffs on rice under EO 62.
“Nonetheless, higher prices of food items other than rice, transport charges, and electricity rates continue to pose upside risks to inflation,” it said.
The BSP said the Monetary Board supports the national government’s implementation of the reduction in the tariff on rice imports to address supply-side pressures on prices and sustain the disinflation process.
“Moving forward, the BSP will ensure that monetary policy settings remain in line with its primary mandate to safeguard price stability conducive to sustainable economic growth,” it said.