August inflation quickens to 5.3% after six-month downtrend

August inflation quickens to 5.3% after six-month downtrend
Vendors at the Commonwealth Market in Quezon City sell pork products to customers on March 28, 2023.
The STAR / Jesse Bustos

MANILA, Philippines — Inflation rose to 5.3% in August, reversing the downtrend seen in the last six months amid increases in food and fuel prices, the Philippine Statistics Authority reported Tuesday. 

The country’s headline inflation last month was faster than the 4.7% posted in July, but slower than the 6.3% print in August 2022. 

The latest figure fell within the Bangko Sentral ng Pilipinas’ 4.8 to 5.6% projection. However, this was still above the central bank’s 2 to 4% inflation target. 

“The primary reason for the higher inflation rate is the faster increase in prices of food and non-alcoholic beverages,” National statistician Dennis Mapa said in a briefing.

Inflation for food and non-alcoholic beverages accelerated to 8.1% in August. PSA noted the acceleration of food inflation was mainly due to higher year-on-year growth rate observed in rice, which rose to 8.7% from 4.2%.

The release of the latest inflation figures comes on the first day of the implementation of a cap on rice prices to reduce costs of the grain and penalize hoarding. Analysts and groups, however, said the measure could significantly affect rice farmers and consumers. 

Mapa added that the higher inflation rate in August was also driven by the transport costs, which increased to 0.2% from -4.7% in July due to a slow decrease in the prices of gasoline and diesel. 

Meanwhile, the core inflation, computed without volatile items such as fuel, decelerated to 6.1% in August from 6.7% in July. — Gaea Katreena Cabico

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