By Andreah Diane Cartagena

Philippine Statistics Authority (PSA) reported that the annual inflation rate of 6.4% in July 2022, the highest uptrend since October 2018, is due to food and transportation price increase.

Photo Courtesy of Ibon Foundation/JC Punongbayan/The Philippine STAR

According to PSA Chief and National Statistician Claire Dennis Mapa, food inflation rose to 6.9% year-on-year, which contributed to 64% of the overall inflation rate last month. The spike is attributed to the high prices of seafood, meat, and sugar.

An 18.1% inflation on transportation was listed as the second largest contributor to the overall increase in consumer prices. Mapa said this is evident on the fares for jeepney, sea ferries, and air travel.

Mapa added that this is not yet the maximum inflation according to their data as restaurant and accommodation services, the third largest contributor to the uptrend, are seen to raise their prices following the increase of their input cost.

The Banko Sentral ng Pilipinas (BSP) has predicted the inflation to rise to 5.6% or 6.4% for July as the country would feel the second-round effects of elevated prices.

"The BSP recognizes the broadening of price pressures amid the emergence of second-round effects, including the approved wage and fare hikes as well as elevated inflation expectations. The risk to the inflation outlook is tilted on the upside for 2022 and 2023 but is broadly balanced for 2024," it stated.

The central bank also said they are taking all necessary policy action to bring inflation back to a "target-consistent path" and stable prices.

The Palace had previously stated that the government expected this spike on the same day, August 5, Friday.

"I understand that these were projected even before, given the inputs based on international events that have led to the increase in the prices of petroleum. So all of these had been factored in and, in fact, even mentioned in the State of the Nation [Address] of the President," Press Secretary Trixie Cruz-Angeles said.

In June this year, the country recorded a 6.1% inflation rate, which the PSA explained that the uptrend has been consistent since the 3% record in February.

The National Capital Region had a slow trend with 5.1% from 5.6% in June.

Meanwhile, areas outside Metro Manila had a faster trend at 6.8% from 6.3%, led by Davao City at 8.6%, while Bangsamoro Autonomous Region in Muslim Mindanao had the slowest pace at 3.6%. 

Edited by Danfe Lean Grace Elopre