The country’s inflation rate slowed down to 4.1 percent in June from the previous month’s 4.5 percent as fuel and transport costs decelerated, the Philippine Statistics Authority said yesterday.
Last month’s figure brought the average inflation rate for the first six months of the year to 4.4 percent.
In a virtual press briefing, PSA undersecretary and national statistician Dennis Mapa said the transport index, particularly tricycle fare, slightly decelerated following the decline in inflation of petroleum and fuels.
Mapa attributed the slowdown in transport inflation to the “base effect” as there was a higher trajectory in the level of transport costs from March to June 2020.
He said the inflation of petroleum and fuels, that contributed almost half to the overall inflation last month, declined to 21.5 percent from 33 percent.
He said food and non-alcoholic beverages, particularly meat and fish, also mainly contributed to overall inflation last month with a 44.6-percent share.
Mapa said the PSA is monitoring if the drop in pork prices will be sustained.
“The weight of the meat component in the food basket is big, so our inflation rate can decline next month. In other words, there are items that we are tracking that will have a potential effect in the change trajectory in the trend that we see now in inflation,” he said.
Mapa said inflation in the NCR slowed down to 3.2 percent in June from 3.6 percent the previous month, while inflation in areas outside the NCR eased to 4.4 percent from 4.7 percent.
INTERVENTIONS
The National Economic and Development Authority said policy interventions to stabilize commodity prices have begun to take effect as headline inflation decelerated in June 2021.
“Recent policies to increase food supply are beginning to bring down inflation. Rest assured that the government will continue to address constraints in the availability and movement of goods amid quarantine restrictions to ensure that households have access to affordable food,” Socioeconomic Planning Secretary Karl Kendrick Chua said in a statement.
“The declining meat inflation points to the positive effects of Executive Orders (EO) 133 and 134. These are expected to further bring down meat prices during the second half of the year,” Chua said.
With the spike in pork prices resulting from the African swine fever outbreak that significantly reduced domestic pork production, President Rodrigo Duterte declared a one-year state of calamity on May 10, 2021.
This allowed LGUs to access their calamity funds and realign resources to help the hog industry.
Other government interventions include hog repopulation programs, food safety and ASF-zoning, and ASF vaccine development.
To complement efforts in boosting pork production and containing the ASF, the government adopted EO 133, which increased the minimum access volume (MAV) for imported pork, and EO 134, which imposed a temporary reduction of pork tariffs.
Meanwhile, to ensure stable rice supply, Duterte also issued EO 135 to temporarily reduce the most favored nation (MFN) tariff rates on imported rice to 35 percent from 40 to 50 percent.
This allowed the country to diversify its market sources, expand rice supply, and further bring down rice prices.
“In managing inflation, our priority will be to continue improving our domestic production and providing needed support to our farmers and producers. When necessary, we will augment supply with importation to keep prices stable and to guarantee food security. This balancing act will help us better manage the impact of inflation on the people and the economy,” Chua said.*PNA
