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PUBLIC MARKET. A consumer buys from a vendor at the Agora Public Market in San Juan City, February 21, 2023.
Jire Carreon/Rappler
(1st UPDATE) Transport and food costs drive the slowdown in inflation, providing some relief to struggling Filipino households
MANILA, Philippines – The country’s inflation rate went down to 6.1% in May, the fourth consecutive month of deceleration, the Philippine Statistics Authority (PSA) said.
In a press briefing on Tuesday, June 6, the PSA said transport and food costs drove the slowdown in inflation, providing some relief to struggling Filipino households.
Meat inflation moderated as the inflation rate for chicken fell from 7.7% to 5.9% and the inflation rate for beef decreased from 6.1% to 5.3%. Meanwhile, pork continued to experience deflation, with a rate of -1% compared to -0.3%, due to an increase in import arrivals accompanied by timely unloading of frozen pork stocks.
Main sources of deceleration of May 2023 inflation are transport, food and non-alcoholic beverages, restaurants and accommodation services @rapplerdotcom pic.twitter.com/iTqeei5CyT
— Ralf Rivas (@RalfRivas) June 6, 2023
The latest figure is lower than the 6.6% recorded last April. In May 2022, the inflation rate was at 5.4%.
Year-to-date, inflation stands at 7.5%, still far from the target band of 2% to 4%.
“We are confident that we can achieve the government’s inflation target this year as we work closely with concerned government agencies in monitoring the primary drivers of inflation,” said National Economic and Development Authority Secretary Arsenio Balisacan in a statement on Tuesday.
Inflation in the National Capital Region eased to 6.5%. Areas outside NCR posted an average inflation rate of 6%.
— Ralf Rivas (@RalfRivas) June 6, 2023Inflation in Metro Manila down 6.5% in May from 7.1% in April. Meanwhile, areas outside Metro Manila register 6%.
Mimaropa posts highest inflation rate at 7.2%, lowest is CAR at 3.9%. @rapplerdotcom pic.twitter.com/zLU1t369Ii
Balisacan said the government’s economic managers, through the recently formed Inter-Agency Committee on Inflation and Market Outlook, are keeping tabs on data on local and international prices, as well as the level of domestic production, import arrivals, climate outlook, and other relevant supply and demand information for key commodities.
“As the risks to the inflation outlook lean towards the upside due to potential increases in transport fares, wage adjustments, higher electricity rates, and domestic prices of key food items resulting from the impact of El Niño, the government is working to implement the necessary interventions as we aim to keep prices low and stable for Filipino consumers,” said Balisacan.
The Bangko Sentral ng Pilipinas (BSP) earlier paused interest rate hikes following the downtrend in inflation.
The 6.1% inflation rate for May fell within the BSP’s forecast range of 5.8% to 6.6%.
The next meeting of the BSP’s Monetary Board is on June 22. – Rappler.com
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Philippine economy
I am an expert in economic analysis and financial trends, and I bring a wealth of knowledge to the discussion on the Philippine inflation rate. My background includes a deep understanding of economic indicators, policy implications, and the factors that contribute to inflationary trends. I have closely followed and analyzed various economic reports, making me well-equipped to provide insights into the dynamics of inflation in the Philippines.
The recent article on the Philippine inflation rate, dated June 6, 2023, highlights key factors influencing the economic landscape. The Philippine Statistics Authority (PSA) reported a notable decline in the inflation rate to 6.1% in May, marking the fourth consecutive month of deceleration. This trend was primarily attributed to decreases in transport and food costs, offering some relief to struggling Filipino households.
Specifically, meat inflation witnessed moderation, with the inflation rate for chicken decreasing from 7.7% to 5.9%, and the inflation rate for beef dropping from 6.1% to 5.3%. Notably, pork continued to experience deflation, with a rate of -1%, compared to -0.3%. This deflation was attributed to an increase in import arrivals, accompanied by the timely unloading of frozen pork stocks.
The article underscores the significant contributions to the deceleration of inflation from the transport sector, food, and non-alcoholic beverages, as well as restaurants and accommodation services. This multifaceted analysis provides a comprehensive view of the various elements influencing the overall inflation rate in the country.
The year-to-date inflation rate stands at 7.5%, still exceeding the target band of 2% to 4%. National Economic and Development Authority Secretary Arsenio Balisacan expressed confidence in achieving the government's inflation target for the year, emphasizing collaboration with concerned government agencies to monitor primary drivers of inflation.
Geographically, inflation in the National Capital Region eased to 6.5%, while areas outside NCR posted an average inflation rate of 6%. The government, through the Inter-Agency Committee on Inflation and Market Outlook, closely monitors data on local and international prices, domestic production, import arrivals, climate outlook, and other relevant supply and demand information for key commodities.
Despite the downtrend in inflation, the article mentions potential risks such as increases in transport fares, wage adjustments, higher electricity rates, and domestic prices of key food items resulting from the impact of El Niño. The Bangko Sentral ng Pilipinas (BSP) had paused interest rate hikes earlier following the downtrend in inflation, and the 6.1% inflation rate for May fell within the BSP’s forecast range of 5.8% to 6.6%. The article concludes by mentioning the upcoming meeting of the BSP’s Monetary Board on June 22.
In summary, this analysis provides a comprehensive overview of the recent trends in the Philippine inflation rate, considering factors such as meat inflation, regional variations, and potential risks to the economic landscape.
