MANILA - Inflation eased further in July to its lowest level in 7 months mainly due to the slower transport price movement, the state statistics bureau said Thursday.
The consumer price index rose 4 percent in July, compared to the 4.1 percent inflation in June, the Philippine Statistics Authority said.
The July inflation is within the top band of the government's 2 to 4 percent target range and also within the Bangko Sentral ng Pilipinas forecast of 3.9 to 4.7 percent.
July's inflation rate is below some analysts' expectations. BPI lead economist Jun Neri said airfares contributed to the downward rate but prices of other necessities remain elevated.
"What people really consume, if we exclude those things that we don’t really consume much of anyway, prices remain elevated and that affects the decisions of borrowers and savers," Neri told ANC.
Non-monetary measures meant to ease supply constraints are crucial in tempering inflation pressures, BSP Gov. Benjamin Diokno said in a statement.
"The latest outturn is consistent with the BSP’s assessment that inflation could settle close to the high end of the target range of 2.0 to 4.0 percent over the near term before decelerating back to within the target by end of the year as the impact of government supply-side measures take effect," he said.
Diokno said inflation is expected to "remain firmly" within the midpoint of the target range of 2 to 4 percent for 2022 to 2023.
The outlook, moving forward, remained broadly balanced but the new COVID-19 Delta variant, as well as restrictions to curb its spread, could pose downside risks to demand and inflation, he said.
"On the other hand, the emergence of new coronavirus variants and delays in easing lockdown measures are seen to pose downside risks to both demand and inflation," Diokno said.
The central bank chief earlier said the monetary board would keep its policy stance "accommodative" as long as necessary to support the economy.