Inflation slows down to 2.1 percent in May 2020 – PSA

MANILA, Philippines — Inflation in the country slightly slowed down to 2.1 percent in May, the Philippine Statistics Authority (PSA) reported Friday.

This brings the year-to-date inflation for 2020 at 2.5 percent, PSA said in its report.

The latest figure is lower than the 2.2 percent registered in April and 3.2 percent in May 2019.

“Slowdown in the headline inflation in May 2020 was mainly driven by the 5.6 percent annual drop in the transport index,” said PSA.

It added that the slower annual rate in the food and non-alcoholic beverages index also pushed down the overall inflation rate last month.

The downtrend in the headline inflation was also caused by the deceleration in the annual increments recorded in the indices of the following commodity groups during the month: food and non-alcoholic beverages, 2.9 percent; clothing and footwear at 2.4 percent; furnishing, household equipment and routine maintenance of the house at 4.1 percent, and; recreation and culture at 1.4 percent.

Meanwhile, a higher annual increase of 18 percent was recorded in the index of alcoholic beverages and tobacco, according to PSA.

The indices of the rest of the commodity groups such as housing, water, electricity, gas, and other fuels, health, communication, education, and restaurant and miscellaneous goods and services retained their previous month’s annual growth rates.

“Core inflation in May 2020 retained its previous month’s annual rate of 2.9 percent. In May 2019, it was posted at 3.5 percent,” read the report.

Inflation for food at the national level slowed down to 2.9 percent in May 2020, from 3.4 percent in April. It was marked at 3.2 percent in May 2019.

Annual decreases were still noted in the indices of rice at 2.7 percent; corn at 0.7 percent; and sugar, jam, honey, chocolate and confectionery at 0.8 percent.

The indices of other food groups also exhibited slower annual increments during the month, except for the indices of other cereals, flour, cereal preparation, bread, pasta and other bakery products; and oils and fats, whose annual growth rates were higher at 2.7 percent and 2.1 percent, respectively, according to PSA.

Inflation in Metro Manila

On the contrary, inflation in Metro Manila was higher at 1.4 percent in May 2020 than in April which registered 1.2 percent. In May 2019, inflation in the region was at 3.4 percent.

The transport index registered a slower annual decline of 1.8 percent in May than its annual drop in the previous month of 6.5 percent.

Annual gains likewise decelerated for food and non-alcoholic beverages at 2.7 percent; alcoholic beverages and tobacco at 13.8 percent; and recreation and culture at 0.6 percent.

According to PSA, the indices of the following commodity groups retained their previous month’s annual growth rates: clothing and footwear at 1.2 percent; housing, water, electricity, gas, and others fuels at -1.7 percent; furnishing, household equipment and routine maintenance of the house, 5.8 percent; health, 2.1 percent; communication, 0.3 percent; education, 5.7 percent; and restaurant and miscellaneous goods and services at 1.9 percent.

Inflation in areas outside Metro Manila

Similar to the trend at the national level, inflation in Areas Outside the National Capital Region (AONCR) further eased at 2.2 percent in May 2020 compared to the 2.5 percent in April.

In May 2019, inflation in areas outside Metro Manila was at 3.1 percent.

“Contributing to the downtrend in the inflation in the area (AONCR) was the 6.8 percent annual drop in the transport index,” said PSA.

Annual hikes decelerated in the indices of the following commodity groups: food and non-alcoholic beverages at 3.1 percent; clothing and footwear, 2.8 percent; housing, water, electricity, gas, and other fuels, 0.9 percent; furnishing, household equipment and routine maintenance of the house, 3.6 percent; and recreation and culture at 1.6 percent.

PSA reported that annual growth rates were higher in the indices of alcoholic beverages and tobacco at 18.8 percent and health at 3 percent. The indices of the rest of the commodity groups such as communication, education, and restaurant and miscellaneous goods and services retained their previous month’s annual growth rates.

Eleven regions in AONCR recorded lower inflation in May 2020 relative to their inflation for the previous month. The lowest inflation among the regions outside Metro Manila during the month was still recorded in Northern Mindanao at 1 percent, while the highest remained in Soccsksargen at 3.6 percent.

GSG