Inflation in April decelerated to an eight-month low of 6.6 percent from 7.6 percent in March on slower increases in the prices of food and non-alcoholic beverages, the Philippine Statistics Authority said Friday.
Data from the PSA showed the April inflation was the slowest since it settled at 6.3 percent in August 2022.
National statistician and civil registrar general Dennis Mapa said, however, the April inflation remained elevated compared to 4.9 percent in April 2023.
The latest figure brought the average inflation in the first four months to 7.9 percent, above the government’s target range of 2 percent to 4 percent.
Finance Secretary Benjamin Diokno said the continued decline of inflation since the peak of 8.7 percent in January 2023 was a positive development. “The recent inflation numbers indicate that we are on track to managing inflation to within the target range sometime in the fourth quarter, if not sooner, and near the midpoint of the target range of 2 to 4 percent by next year,” he said.
He said this clearly demonstrated that the whole-of-government approach to tackling inflationary pressures “is bearing fruit.”
The April inflation outturn was within the Bangko Sentral ng Pilipinas’ forecast range of 6.3 percent to 7.1 percent for the month, consistent with the overall assessment that inflation would remain elevated over the near term before gradually decelerating back to target range towards end-2023.
“The balance of risks to the inflation outlook for 2023 and 2024 also remains tilted heavily towards the upside. Despite the recent slowdown in food inflation, the potential effect of ongoing supply shortages continues to pose an upside risk to the outlook,” the BSP said in a statement.
The BSP said the policy-making Monetary Board would consider the latest figure along with the upcoming gross domestic product data for the first quarter of 2023 in its policy meeting on May 18, 2023 as it committed to adjusting the monetary policy stance as necessary to prevent the further broadening of price pressures and the emergence of additional second-order effects.
The BSP said it also supports the timely and effective implementation of non-monetary government measures to mitigate the impact of persistent supply-side pressures on inflation.
The PSA said among the 13 commodity groups, the downtrend of the overall inflation was mainly due to the heavily weighted food and non-alcoholic beverages, which recorded a lower inflation rate of 7.9 percent compared to 9.3 in March.
Core inflation—or the change in prices of goods and services except for those from the food and energy sectors—also eased to 7.9 percent in April from 8 percent in March.
“We hope inflation will continue to go down in the coming months,” Mapa said, but warned that the onset of El Nino could pose a threat to the prices of commodities.
National Economic and Development Authority Secretary Arsenio Balisacan also expressed optimism that the downward trend would continue and settle further within the government’s outlook.
Balisacan said the Inter-Agency Committee on Inflation and Market Outlook continues its monitoring on the ground and facilitates regular and systematic data-sharing to provide timely recommendations to the President and relevant agencies on measures to mitigate inflation and ensure sufficient food and energy supply.
“It is important to design policies and interventions to help those that will be affected by El Niño, through the provision of seeds or seedlings of non-water- loving crops or crop varieties. Additionally, the government must remain proactive in curbing animal disease outbreaks through stronger border protection and monitoring,” Balisacan said.
Inflation reached a 14-year high of 8.7 percent in January 2023.