By Julito G. Rada, August 4, 2023; Manila Standard
Inflation in July 2023 eased to a 16-month low of 4.7 percent from 5.4 percent in June, pulled down by slower year-on-year increase in housing, water, electricity, gas and other fuels, the Philippine Statistics Authority said Friday.
“This is the sixth consecutive month of deceleration in the headline inflation and the lowest since March 2022 with an inflation of 4 percent,” national statistician and civil registrar general Dennis Mapa said in an online briefing.
The July inflation was also slower than 6.4 percent in June. This brought the average in the first seven months to 6.8 percent, still higher than the 2023 target range of 2 percent to 4 percent.
“While we continue to experience a downtrend in inflation, we need to be vigilant, especially as we face increasingly volatile weather disturbances as well as external headwinds such as oil price increases and trade restrictions on food,” said National Economic and Development Authority Secretary Arsenio Balisacan.
He assured the public that the government is proactively monitoring the supply and demand situation of key commodities to achieve its inflation target of 2 to 4 percent by end of the year.
Food inflation decelerated to 6.3 percent in July from 6.7 percent in June, as inflation rates of the following food items slowed: fish and other seafood (4.5 percent from 6.2 percent), eggs and dairy products (9.7 percent from 11.2 percent), bread and other cereals (10.1 percent from 11.0 percent) and sugar (21.4 percent from 28.9 percent).
Non-food inflation also eased to 3.3 percent in July from 4.1 percent in June. Inflation of electricity, gas, and other fuels slowed from 5.2 percent to 2.5 percent, while inflation for passenger transport services declined from 11.2 percent to 7.2 percent.
Non-food items, including food services, housing rentals and passenger transport, remain the top contributors to inflation, contributing a total of 1.8 percentage points. Agricultural commodities such as vegetables, rice, fish, and dairy products contributed a total of 1.5 percentage points.
Balisacan said the government took steps to deploy its resources to affected areas as well as prepare its policy and on-the-ground response as it expects more typhoons and weather disturbances from the El Niño to ensure that the current weather disturbances would not have a lingering impact on inflation and the economy for the rest of the year,
“The government will implement necessary measures to prevent price spikes, protect the purchasing power of Filipino families, and sustain our economic recovery and momentum,” he said.
The Inter- Agency Committee on Inflation and Market Outlook and the Economic Development Group held a joint meeting on July 20, 2023 to discuss proposed policy adjustments that seek to ensure a more stable supply of agricultural products to meet the demand of different users and end- consumers adequately.
The committee reiterated the productivity-enhancing and efficiency-improving strategies laid out in the Philippine Development Plan 2023-2028 concerning agriculture and agribusiness. These measures aim to secure the country’s food supply, prevent sudden increases in agricultural commodity prices, improve the well-being of farmers and fisherfolk, and ensure the vital contribution of agriculture to other sectors of the economy.