Central Visayas inflation rises to 4% in May

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File photo

CENTRAL Visayas saw an upsurge in inflation to four percent in May 2024, a 0.8 percentage point increase from the previous month, according to the Philippine Statistics Authority (PSA) 7 on Thursday, June 13, 2024.

PSA 7 supervising statistics specialist Felixberto Sato Jr. said the May 2024 inflation rate was higher than the 3.2 percent recorded in April and March, and 2.7 percent in February.

The May regional inflation was also higher than the national inflation of 3.9 percent but lower than the five percent inflation recorded in the region in May 2023.

Sato explained that this month’s increase in inflation indicates a rise in the average price level of goods and services in the region over a certain period.

Inflation is the gradual rise in prices of goods and services, which reduces the purchasing power of a currency. It also reflects the percentage change in the average price level of goods and services over the base year in 2018, making money worth less as each unit buys fewer goods and services.

Three main drivers influenced the increase.

Food and Non-Alcoholic Beverages’ inflation rose to 6.4 percent in May from five percent in April. Significant increases were noted in cereal and cereal products to 12.3 percent (from 9.5 percent in April), vegetables, tubers, etc. to 11.4 percent (from 1.7 percent), and meat and other parts of slaughtered animals to 6.8 percent (from 6.5 percent), particularly fresh or frozen meat and poultry products.

Transport Commodity recorded an uptick to 2.3 percent from the negative 1.4 percent reported in April 2024. Passenger transport by sea and inland waterway recorded a negative four percent inflation in May from -31.5 percent; gasoline recorded an inflation of 4.3 percent versus 3.5 percent; while diesel posted a 9.6 percent inflation, an increase from 8.2 percent in April.

Inflation in Housing, Water, Electricity, Gas, and Other Fuels increased to 1.6 percent from 1.1 percent in April. Electricity posted a -20.2 percent inflation compared to -23.3 percent in April.

Meanwhile, food inflation at the regional level rose to 6.7 percent in May 2024 compared to 5.2 percent in April 2024, slightly lower than May 2023 at 6.5 percent.

Sato highlighted that the El Niño-induced dry spell influenced the increase in the region’s inflation, particularly affecting the agricultural sector due to crop damage and supply-demand dynamics.

Among the 13 major commodity groups, food and non-alcoholic beverages contributed 60.1 percent share to the overall inflation, followed by restaurants and accommodation services with 9.4 percent share, and housing, water, electricity, gas, and other fuels with 9.3 percent share.

Within BSP’s target

According to the Bangko Sentral ng Pilipinas, the country’s May 2024 inflation of 3.9 percent is within its forecast range of 3.7 to 4.5 percent. The BSP noted that inflation is consistent with expectations that it could temporarily accelerate above the target range due to adverse weather conditions affecting domestic agricultural output and positive base effects. The BSP expects average inflation to return to the target range for full-year 2024 and 2025.

“The risks to the inflation outlook continue to lean toward the upside. Possible further price pressures are linked mainly to higher transport charges, elevated food prices, higher electricity rates, and increase in global oil prices,” the central bank said.

Looking ahead, the BSP said the Monetary Board will consider the latest inflation outturn in its upcoming monetary policy meeting on June 27. / WITH KOC

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