In August, the inflation rate rose to 5.3 percent from 4.7 percent in July, driven by higher food and transport costs.
This increase is a reversal of a six-month trend of decelerating prices. However, the latest inflation rate is lower than the 6.3 percent recorded in August of the previous year.
The inflation rate last month falls within the projected range of 4.8 percent to 5.6 percent set by the central bank.
Despite this, the year-to-date average inflation rate stands at 6.6 percent, above the central bank's target range of two percent to four percent.
Food and non-alcoholic beverages were the main contributors to the higher inflation rate, with an inflation rate of 8.1 percent in August.
Vegetable prices also saw a notable increase, with an inflation rate rising from 21.8 percent to 31.9 percent in August, due to losses from heavy rains and Super Typhoon Egay.
Inflation climbs in Aug. on high food, transport prices
Consumer prices rise after six months of slowing down
At a glance
The rate of increase in consumer prices accelerated for the first time in six months in August, driven by higher food and transport costs, the Philippine Statistics Authority (PSA) reported.
In a briefing on Tuesday, Sept. 5, National Statistician Dennis S. Mapa said that the headline inflation increased to 5.3 percent last month from 4.7 percent in July.
The latest inflation rate, however, slowed from 6.3 percent in the same month last year. It is also within the 4.8 percent to 5.6 percent projected by the Bangko Sentral ng Pilipinas for last month.
August’s rate brought the year-to-date average to 6.6 percent, still above the central bank’s two percent to four percent target range and President Marcos’ assumption of five percent to six percent for 2023.
Food and non-alcoholic beverages were the top contributors to the inflation to 8.1 percent from 6.3 percent in July.
The cost of rice heats up to 8.7 percent in August from 4.2 percent in July.
According to the PSA, this is due to the reduction in rice production caused by El Nino and the export ban implemented by major rice exporters such as India and Myanmar.
While the increase in vegetable prices, which rose from 21.8 percent to 31.9 percent in August, was due to the losses from enhanced monsoon rains and Super Typhoon Egay.
From 5.6 percent in July, the inflation rate for the National Capital Region (NCR) zoomed to 5.9 percent due to the rising costs of food and non-alcoholic beverages which posted 8.6 percent inflation rate compared to 6.4 percent in July.
Also contributing to the quicker pace are housing, water, electricity, gas, and other fuels which posted 5.3 percent from the previous month’s 6.9 percent.
Furnishings, equipment, and routine household maintenance likewise drove up the inflation rate in Metro Manila by 6.1 percent compared to 6.2 percent in July.
Meanwhile, inflation in areas outside NCR also accelerated from 4.4 percent to 5.2 percent last month.
Central Luzon posted the quickest pace, generating a 7.0 percent rate while Eastern Visayas posted the lowest rate at 3.1 percent
In August, core inflation, which excludes certain volatile food and energy items, slowed to 6.1 percent from 6.7 percent in the previous month. However, compared to the same period last year, it accelerated from 4.6 percent.
National Economic and Development Authority Secretary Arsenio M. Balicasan said that despite the increasing food prices, the two percent to four percent goal inflation rate in 2023 remains the same.
“Despite the ongoing challenges we encounter, such as severe weather conditions and trade limitations imposed by other nations, our objective remains to achieve an inflation rate between 2 and 4 percent by the year’s end,” Balicasan said in a statement.
The NEDA chief also urged a review of existing tariff levels on rice to help lower its cost for consumers.
“To partially counterbalance the rise in global prices and alleviate the impact on consumers and households, we may implement a temporary and calibrated reduction in tariffs,” he said. (Xander Dave G. Ceballos)