Philippines June Inflation Rate Slows to 22-Month Low of 2.7%


The Philippines' annual inflation rate fell to a 22-month low of 2.7 percent in June 2019 from 3.2 percent in the previous month and below market expectations of 2.9 percent. Food inflation dropped to its lowest since January 2017, and there was a slowdown in cost of both housing and transport.

The central bank set an inflation target range of between 2 to 4 percent from 2018 to 2020.

Year-on-year, prices of food and non-alcoholic beverages increased by 2.7 percent in June, slowing from a 3.4 percent rise in May. It was the lowest food inflation since January 2017, as cost fell for corn (-4 percent), rice (-1.7 percent), and bread (-0.6 percent), while prices rose further for other cereals, flours, cereal preparation, bread, pasta and other bakery products (3.6 percent); meat (3.3 percent); fish (3.8 percent); milk, cheese and egg (2.5 percent); oils and fats (2.9 percent); fruits (5 percent); vegetables (9.5 percent); sugar, jam, honey (2.2 percent), and food products, n.e.c (7.3 percent).

In addition, prices eased for housing, water, electricity, gas and other fuels (3 percent vs 3.3 percent in May); transport (1.6 percent vs 3.5 percent); furnishing, household equipment and routine maintenance (3.1 percent vs 3.2 percent); communication (0.3 percent vs 0.4 percent); and alcoholic beverages and tobacco (9.3 percent vs 9.5 percent). Also, cost of education fell further (-4.5 percent vs -3.8 percent). In contrast, inflation was steady for both clothing and footwear (at 2.4 percent), and restaurant and miscellaneous goods and services (at 3.3 percent). Additionally, prices advanced at a faster pace for both health (3.7 percent vs 3.6 percent) and recreation and culture (3.2 percent vs 3.1 percent).

On a monthly basis, consumer prices rose by 0.2 percent in June, slowing from a 0.3 percent gain in May. Prices went up for alcoholic beverages and tobacco (0.7 percent); clothing and footwear (0.2 percent); housing, water, electricity, gas and other fuels (0.4 percent); furnishing, household equipment and routine maintenance (0.2 percent); health (0.3 percent), recreation and culture (0.1 percent), education (1.2 percent), and restaurants & miscellaneous goods and services (0.3 percent). Meanwhile, cost of transport dropped (-1.5 percent) while food and non-alcoholic beverages prices were flat.

Philippines June Inflation Rate Slows to 22-Month Low of 2.7%


PSA l Rida Husna | rida@tradingeconomics.com
7/5/2019 9:43:51 AM