Inflation surges to 4.4% in July, exceeding government target

MANILA, Philippines (Updated 10:03 a.m.) — Philippine inflation surged to 4.4% in July 2024, accelerating from last month's relatively mild 3.7%, the Philippine Statistics Authority said Tuesday.

The Bangko Sentral ng Pilipinas previously forecasted that inflation would exceed the government’s target inflation of 2% to 4%, saying that it could have gone as high as 4.8%. 

PSA Undersecretary Claire Dennis Mapa said the main source of July 2024’s inflation was the increase in prices of food and non-alcoholic beverages, which had an inflation of 6.4%. This contributed a total of 55.5% to the overall inflation.

Cereals, meats, as well vegetables and tubers were the main sources of inflation under food. 

Housing, water, electricity, gas and other fuel price inflation was at 2.3%, contributing 11.3% to the uptick in overall inflation. Rentals, LPG and water supplies were the main contributors in this category.   

The third highest contributors to national inflation were restaurants and accommodation services, which had an inflation of 4.9% and had a share of 10.8% for overall inflation. 

In terms of commodities, the PSA listed the top five contributors to inflation: 

1. Rice
2. Restaurants 
3. Rentals 
4. LPG 
5. Tomatoes, fresh or chilled  

In a statement, National Economic and Development Authority Sec. Arsenio Balisacan said the increase was expected.

"The government is relentlessly working to address our nation's most pressing concern of ensuring food security for every Filipino amid the faster rise in prices in July and the expected typhoons and rains due to the onset of La Niña this August," Balisacan said.

By category. The PSA also found that the commodity groups with the highest inflation rates are: food and nonalcoholic beverages (6.4%), housing, water, electricity, gad and other fuels (2.3%), transport (3.6%), education services (5.8%).   

Meanwhile, lower inflation was recorded for the following commodity groups: alcoholic beverages and tobacco (3.4%), clothing and footwear (3.1%), health (2.8%), recreation, sports and culture (3.4%), and restaurants and accommodation services (4.9%).

Regions. For the National Capital Region, inflation stood at 3.7% last July, an increase from June's 2.3%. Areas outside of the Metro have a higher inflation rate of 4.6% for July, compared to June's 4.1%.  

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