MANILA — Lower food and energy prices pulled down the country’s inflation rate to its new lowest level in 20 years for the third consecutive month in July.
The Philippine Statistics Authority reported that headline inflation rate plunged further to 0.8 percent in July 2015 from 1.2 percent in the previous month and 4.9 percent in July 2014.
Last month’s figure brought average inflation rate in January to July to 1.9 percent, slightly lower the inflation target range of 2.0 to 4.0 percent set by the government for 2015.
In a statement, Economic Planning Secretary Arsenio M. Balisacan said that using the current base year 2006, the July 2015 inflation rate is a new record low, covering the monthly inflation series from 1995 to June 2015.
Headline inflation in the food subgroup eased further in July 2015 to 1.3 percent from 2.1 percent in June, following moderate price pressures in bread and cereals, fish, vegetables and fruits.
“In part, the increase in total rice stocks inventory, which grew by 30.9 percent year-on-year as of June 2015, supported the normalization of rice prices from double-digit annual growths recorded in 2014,” said Balisacan.
Non-food inflation also reflected stable price movements in July 2015 following continued rollbacks in the prices of electricity, gas and other fuels.
Meanwhile, core inflation, which excludes selected volatile food and energy prices, slid further to 1.9 percent from 2.0 percent in June 2015 and 3.0 percent in July 2014.
“The easing of the core inflation is favorable for household consumption and supports economic expansion moving forward, as it provides less pressure for interest rates to increase,” added Balisacan.
Inflation in the National Capital Region accelerated due to slight increases in the prevailing prices of basic necessities and prime commodities. All regions, except the Davao Region, posted slower year-on-year price increases.
Balisacan underscored the need for the government to be wary of the upside risks to inflation such as the occurrence of typhoons in the second semester which is expected to be intensified by the prolonged El Nino phenomenon.