Govt to ‘support sustainable growth’ amid global uncertainty
Philippine headline inflation accelerated to 1.4 percent in June from 1.3 percent in May, coming within forecast ranges and staying aligned with government hopes for a 2025 below-target average.
Although seeing global uncertainty possibly weighing on domestic economic growth, the central bank said it will ensure monetary policy remains conducive to sustainable growth.
The Philippine Statistics Authority (PSA), which released the inflation report on Friday, traced the uptick to bigger price increases in housing, water, electricity, gas and other fuels.
The June rate brings the average for January to June 2025 to 1.8 percent.
Comparative inflation rate in June 2024 was at 3.7 percent.
Within govt, private forecasts
The June 2025 inflation outturn comes within the forecast range by Bangko Sentral ng Pilipinas (BSP) of 1.1 to 1.9 percent, BSP Governor Eli Remolona said, also on Friday.
The June 2025 inflation outturn comes within the Bangko Sentral ng Pilipinas’ forecast range for June of 1.1 to 1.9 percent, BSP Governor Eli Remolona said also on Friday.
The latest headline inflation rate also matched the mean average forecast of 1.47 percent made by 10 analysts polled by Malaya Business Insight last week.
Core inflation during the month in review, which excludes selected food and energy items, was recorded at 2.2 percent for the fourth consecutive month. In June 2024, core inflation reached 3.1 percent.
Higher housing, utilities costs
National Statistician and Civil Registrar General Claire Dennis S. Mapa said the index for housing, water, electricity, gas and other fuels rose 3.2 percent year-on-year in June, faster than 2.3 percent posted in May.
Higher inflation rates were also observed in the indexes for clothing and footwear at 1.7 percent from 1.6 percent and furnishings, household equipment, and routine household maintenance at 2.1 percent from 2.0 percent.
Education service costs also gained pace to 5.4 percent from 4.2 percent and restaurants and accommodation services to 2.1 percent from 2.0 percent.
Food inflation eases
For food inflation, however, deceleration marked the trend in prices.
Mapa said the food index eased to 0.1 percent in June 2025 from 0.7 percent in the previous month.
He said the deceleration of food inflation in June was mainly brought about by the annual decrease of 2.8 percent in vegetables, tubers, plantains, cooking bananas and pulses, from an annual increase of 3.4 percent in the previous month.
This was followed by rice, with a bigger annual drop of 14.3 percent during the month from 12.8 percent in May 2025, he added.
Bigger annual declines were also noted in the indexes for corn at 14.5 percent, and sugar, confectionery and desserts at 0.7 percent in June from their respective year-on-year decreases of 10.6 percent and 0.6 percent in May.
Mapa said food inflation shared 2.3 percent or 0.03 percentage point of the overall inflation in June 2025.
Below 2025 inflation target
For full-year 2025, Remolona expects inflation to fall below the target range of 2 to 4 percent.
“Inflation is projected to remain below the lower end of the target in 2025, primarily due to the continued easing of rice prices. However, this could be partly offset by the recent spike in oil prices,” Remolona said in a statement.
“Global economic activity is showing signs of deceleration, influenced by uncertainty over US trade policy and ongoing geopolitical conflict in the Middle East. These developments may contribute to slower domestic growth,” he said.
Going forward, Remolona said the BSP will safeguard price stability by ensuring monetary policy settings are conducive to sustainable economic growth and employment.
Govt ‘to sustain intervention’
Economy, Planning, and Development (DEPDev) Secretary Arsenio M. Balisacan said government measures to stabilize food supply, boost agriculture, and improve logistics have helped stabilize inflation, particularly prices of key food items.
“The sharp decline in food inflation over the past year underscores the continued progress in our coordinated efforts to boost local production, improve logistics, and implement calibrated trade and biosecurity measures. We will sustain these interventions and complement them with targeted initiatives to ensure a continuous, stable supply and shield consumers from future price pressures,” Balisacan said in a statement.
To further strengthen food supply chains, Balisacan said the Department of Agriculture (DA) will intensify the implementation of industry recovery and expansion programs, such as the Swine Industry Recovery Project (SIRP) and Livestock Economic Enterprise Development.
In support of the onion industry, the DA will establish the country’s first Onion Research and Extension Center in Bongabon, Nueva Ecija.
Balisacan added that the Department of Energy has partnered with private oil companies to offer fuel discounts to motorists affected by oil price fluctuations amid geopolitical uncertainties.
“While the continued easing of food inflation is encouraging, we will maintain our vigilance against possible external and domestic risks. Volatile global markets and climate-related disruptions affecting fuel and electricity costs continue to threaten price stability. We will remain focused on strengthening interagency coordination in implementing timely, targeted, and evidence-based interventions to safeguard the purchasing power of Filipino households, ensuring that the much-needed support reaches the most vulnerable sectors of the country,” Balisacan said.
