The Department of Finance (DOF) said the recent upswings in food prices resulting from typhoons and the surge in fuel prices would not disrupt the central bank's forecast that inflation will fall within its target range by the fourth quarter.

Finance Secretary Benjamin E. Diokno said that the two percent to four percent inflation target for the October to December period remains intact, with global crude prices staying within expectations and the increase in rice costs being insignificant.

Diokno also said that even with the expected increase in vegetable prices caused by the impact of recent typhoons, inflation would remain manageable this year.

Addressing the fuel prices, Diokno said the Bangko Sentral ng Pilipinas (BSP) projected crude oil prices to stabilize at around $90 per barrel for 2023, while the current level stands at approximately $80 per barrel.

"As long as the price of oil in the world market does not exceed $90 per barrel, we're okay,” Diokno said in an interview on ANC's Headstart on Tuesday, Aug. 1. “It has gone up a little bit, but it should not concern the inflation-targeting central bank.”

Oil companies implemented a significant hike in pump prices Tuesday, marking the third consecutive week of increases for gasoline and the fourth consecutive week for both diesel and kerosene.

Meanwhile, there have also been growing concerns over the rising prices of the country’s staple food since the beginning of the year.

Rice inflation has escalated, reaching 2.7 percent in January, 2.2 percent in February, 2.6 percent in March, 2.9 percent in April, 3.4 percent in May, and 3.6 percent in June.

“Food inflation has been going down, and there's an uptick recently of rice but that is part of the food inflation,” Diokno said.

Food inflation in June slowed to 6.7 percent compared to the previous month’s 7.5 percent.

In addition to rice, the prices of vegetables and fish have been experiencing an upward trend due to the impact of two consecutive typhoons that hit the northern provinces of Luzon in the past two weeks.

Typhoon Falcon further intensified the southwest monsoon, resulting in rainfall across various areas of Luzon. This followed closely after Typhoon Egay, which caused flooding in several agricultural provinces in the country.

“I think even with a slight increase in food prices and also I assume that vegetables will go up too because of the typhoons, right? I think we're okay. We will hit the projection of, as I said two to four percent, within the fourth quarter of this year,” Diokno said.

On Monday, the BSP said headline inflation is expected to have settled between 4.1 percent and 4.9 percent in July, attributed to lower electricity rates, a rollback in cooking gas prices, and a stronger peso.

Should this projection materialize, it would mark the first time since April last year that inflation falls below the five percent threshold.