THE Philippines’ inflation rate further slowed down at 3.3 percent in August 2024, a decrease that is primarily influenced by the downtrend in food inflation, the National Economic and Development Authority (Neda) said Thursday, September 5, 2024.
In a statement, Neda said the country’s inflation calmed to 3.3 percent in August from 4.4 percent in July 2024.
It said the decline brought the average inflation rate to 3.6 percent, which is still within the government’s target range of 2.0 to 4.0 percent and consistent with other Asean countries, which have also managed their inflation rates within their target ranges, such as Indonesia at 2.6 percent (with a target of 1.5 to 3.5 percent) and Vietnam at 4.4 percent (within a target range of 4.0 to 4.5 percent).
The Neda noted the decrease in food inflation, which significantly went slower to 4.2 percent from 6.7 percent during the month prior.
It said the decline in food inflation is largely attributed to rice inflation that is impacted by the reduced import tariffs, which decreased to 14.7 percent from 20.9 percent in the previous month.
“The sustained easing of inflation will support growth in household consumption, which elevated prices have long suppressed. Low-income households will benefit from the decline in food inflation, as food constitutes more than half (51.4 percent) of the consumption of the bottom 30 percent of households,” Neda Secretary Arsenio Balisacan said.
“Moreover, as businesses have identified persistent inflationary pressure as a significant concern, the recent stability and moderation in inflation will encourage investments, especially as borrowing costs are declining. Most importantly, the appetite for business expansion will improve as consumer spending increases,” he added.
Balisacan said, however, that there could be potential pressures expected to emerge from higher electricity rates and above-normal weather disturbances.
He assured that the government is prepared to address these pressures to ensure a stable inflation, particularly in combatting the effects of the La Niña phenomenon by imposing improvements in early warning systems, the utilization of communication systems to issue warnings about dam openings, measures to address the potential accelerated speed of livestock diseases, and greater involvement of local government units in information dissemination.
Balisacan noted the allocation of P15 billion by the National Government for national risk reduction in 2024.
He said the Department of Agriculture (DA) is also working to expand the Kadiwa ng Pangulo program in the Visayas and Mindanao to enhance the people’s access to affordable agricultural products.
“To promote greater reliability and more affordable electricity, the Energy Regulatory Commission is urged to expedite the full implementation of the lower retail competition and open access threshold. The ERC is considering reducing the threshold from 500 kW to 100 kW, which would enable more electricity end-users to participate in the program,” Balisacan said.
“The government will continue to implement measures to reduce further inflationary pressures, including enhancing agricultural productivity, expanding logistics infrastructure, and ensuring the efficient delivery of social services. These efforts are crucial not only for stabilizing prices but also for ensuring that economic growth translates into tangible improvements in the lives of all Filipinos,” he added. (TPM/SunStar Philippines)