The rate of increase in the prices of goods and services commonly purchased by households may have once again slowed down in June. According to the Bangko Sentral ng Pilipinas (BSP), the inflation rate is estimated to be between 5.3 percent and 6.1 percent, with a midpoint forecast of 5.7 percent. This suggests a decline from the 6.1 percent inflation rate recorded in May and marks the fifth consecutive month of easing inflation since its peak at 8.7 percent in January.
The official readout will be announced by the Philippine Statistics Authority (PSA) on July 7.
In addition, the PSA reported that the growth rate of factory-gate prices slowed down for the eighth straight month to 2 percent in May, primarily due to the decrease in prices of food products.
Read: PH inflation rate for May 2023 slows down further to 6.1%
Downward Price Pressures
The BSP stated that lower prices of meat, fruits, and LPG, or liquefied petroleum gas, could contribute to the downward price pressures in June.
However, higher prices of key food items like rice, vegetables, and fish, along with increased domestic oil prices, electricity rates, and the depreciation of the peso, are the main sources of upward price pressures in June.
Read: Rice prices surge as production costs rise
The BSP’s target is to maintain inflation within a range of 2 percent to 4 percent and achieve a full-year average inflation rate of 3 percent. From January to May, the consumer price index showed an average upward change of 7.5 percent.
Meanwhile, the latest data on prices of manufactured goods leaving producers’ premises reveals a steady decline in the producer price index (PPI) since it reached 7.7 percent in September 2022.
Manufacturing Inflation
In April, manufacturing inflation was recorded at 2.3 percent, indicating a slower annual growth rate of the PPI in May.
The Philippine Statistics Authority stated in its latest monthly report that the slower growth rate of PPI in May 2023 compared to April 2023 was primarily due to the slowdown in the annual increase in the manufacture of food products, which decreased from 4.7 percent in April to 3.7 percent in May.
The manufacture of food products has the highest weight in the computation of the PPI and contributed to 37 percent of the slower year-on-year growth in prices in May.
The incremental rise in prices of food products leaving factories also slowed down from 4.7 percent in April to 3.7 percent in May. Other major contributors to the slower growth of factory prices in May were the manufacture of coke and refined petroleum products, and manufacture of transport equipment.
In May, manufacturing activities in the Philippines expanded at an eight-month high, with both new orders and production increasing at a faster pace, according to S&P Global Market Intelligence.
Read: PH factory activity expansion accelerated in May
The company reported that the purchasing managers index for the Philippines indicated growth for the 16th consecutive month in May, supported by a significant rise in both output and factory orders.
Denial of responsibility! SamacharCentrl is an automatic aggregator of Global media. In each content, the hyperlink to the primary source is specified. All trademarks belong to their rightful owners, and all materials to their authors. For any complaint, please reach us at – [email protected]. We will take necessary action within 24 hours.
Omprakash Tiwary is a business writer who delves into the intricacies of the corporate world. With a focus on finance and economic landscape. He offers readers valuable insights into market trends, entrepreneurship, and economic developments.
Denial of responsibility! Samachar Central is an automatic aggregator of Global media. In each content, the hyperlink to the primary source is specified. All trademarks belong to their rightful owners, and all materials to their authors. For any complaint, please reach us at – [email protected]. We will take necessary action within 24 hours.
