The Philippines’ inflation rate continued its downward trend for the sixth consecutive month in July, according to the Philippine Statistics Authority (PSA).
In an advisory on Friday, the PSA said the consumer price index rose by 4.7%, showing a slowdown from the 5.4% inflation rate recorded in June. The figure was in line with the forecast of 4.1 to 4.9% made by the Bangko Sentral ng Pilipinas (BSP).
National Statistician and Undersecretary Dennis Mapa attributed the deceleration to slower increases in housing, electricity, gas, and other fuel prices. Food price hikes also slowed down to 6.3% in July from 6.7% in the previous month.
Moreover, the average inflation rate for January to July 2023 stood at 6.8%. The easing of inflation came after economic managers revised their forecast for 2023 to a range of 5 to 6%, lower than the 5 to 7% assumption made in April. Inflation had reached a 14-year high of 8.7% in January but has been gradually easing since then.
Core inflation, which excludes volatile food and fuel items, also slowed to 6.7% in July from 7.4% in June. The government is closely monitoring the impact of typhoon Egay on prices in the country, with the possibility of more weather disturbances affecting inflation.
Meanwhile, National Economic and Development Authority Secretary Arsenio Balisacan stressed the need to be vigilant about price increases due to potential oil price hikes, trade restrictions on food, and weather-related challenges.
Despite the challenges posed by typhoon Egay on the agriculture sector, economic managers remain confident that the 2 to 4% inflation target will be achieved by the end of the year. The BSP also noted that it stands ready to adjust monetary policy as needed to ease price pressures, although risks to the inflation outlook continue to lean towards the upside.
For his part, Finance Secretary Benjamin Diokno expressed optimism about inflation, projecting that it could fall below 2% by the first quarter of 2024.
