Inflation eases to 2.4% in July

Inflation eased for the second consecutive month in July to mark the slowest reading in 31 months, according to data released by the Philippine Statistics Authority (PSA) on Tuesday.

In a press conference in Quezon City, National Statistician Claire Dennis Mapa said inflation came in at 2.4%, the slowest since the 2.2% in December 2016.

This compares with the 2.7% in June and the 5.7% in July 2018, which was then the fastest in five years.

"The main driver in the downward trend of inflation in July 2019 was food and non-alcoholic beverages," said Mapa.

Among the index, major food items which saw the largest drops in prices were rice; corn; oils and fats; vegetables; sugar, jam, honey, chocolate and confectionery; and other unclassified food products.

Mapa said July was the third consecutive month that inflation for rice was negative at -2.9, as prices of the commodity continue to decline.

"Relatively, rice last year, the prices of rice last year were really high at this month, so we are seeing a drop and we are expecting really a negative inflation," said Mapa.

The government earlier this year implemented the rice tariffication law, which removed the quantitative restrictions on rice and imposed a 35% tariff on imports from Southeast Asia.

Mapa also attributed the inflation decline to the drop in prices of utilities during the period.

"The second commodity group that largely contributed to the overall inflation was housing, water, electricity, gas, and other fuels," he said.

Other contributors to the slower inflation were the drop in transport prices after the drop in prices of petroleum and fuels for personal transport equipment, jeepney fares, and domestic airfares.

Outside the metropolis, inflation was fastest in MIMAROPA with 4.9%, and slowest in Central Visayas with 1.1%. For the National Capital Region (NCR) alone, inflation was likewise recorded at 2.4%.

"Our expectation is that it will continue to go down or at least stabilize in this number at the coming months," said Mapa.

'Positive development'

In Malacañang, presidential spokesperson Salvador Panelo said the continued drop in inflation was a “positive development” and “indicative of the hard work and strong political will” of President Rodrigo Duterte and his economic managers “in reining in on the soaring prices of basic goods and services.”

“We are confident that disinflation will continue as we remain on guard in monitoring the prices of basic goods and commodities,” Panelo said.

Panelo also assured Filipino consumers that the Duterte administration “will continue to work tirelessly in implementing macroenomic policies which will have a positive impact that can be felt by our nation.” —with Virgil Lopez/KBK, GMA News