Inflation stays too high for gov't target at 4.5% in May 2021

Inflation amid the coronavirus pandemic stayed above the government's target at 4.5% in May 2021, the Philippine Statistics Authority said on Friday, June 4.

It was the third straight month that 4.5% inflation was recorded, following March and April 2021.

The figure is also more than double the 2.1% recorded in May 2020.

The average inflation for January to May 2021 is at 4.4%.

The government aims to restrain inflation within the 2% to 4% target band, but higher meat costs, developments in the global oil market, and electricity rates have placed upward pressures on prices.

Increases in food prices slowed down to 4.6%, but the food index was still the largest contributor to inflation.

Inflation in fish, for instance, rose 7.8%, as galunggong, talakitok, mackerel, hasa-hasa, and lapu-lapu prices went up.

Meat inflation remained high at 22.1%.

Food prices have soared since the start of 2021, as the government failed to contain African swine fever, which had been spreading even before COVID-19.

With the ensuing pork shortage, consumers shifted to other products, effectively causing a spike in prices. (READ: Duterte signs EO lowering tariffs on imported rice)

Meanwhile, transport inflation eased, with tricycle fares slowing to 55.4% in May from 118.8% in April. Petroleum and other fuels also slowed to 26.9% compared to the 30.9% in April.

Inflation in the National Capital Region slightly dropped to 3.6% in May compared to the 3.7% in April, but inflation in areas outside the capital remained at 4.7%.

Economists and debt watchers earlier warned that high prices amid the pandemic-triggered recession would put the Philippine economy in a worrisome state. – Rappler.com

Ralf Rivas

A sociologist by heart, a journalist by profession. Ralf is Rappler's business reporter, covering macroeconomy, government finance, companies, and agriculture.

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