Philippine inflation slows to 6.2%, low-income households face 8.2%

MANILA — Headline inflation eased to 6.2% in July from 6.4% in June as transport and selected service costs increased more slowly, but inflation among households in the lowest 30% income group climbed to 8.2% from 8.0%.

The contrasting figures show that the national slowdown has yet to provide broad relief, particularly for families that spend a larger share of their income on food, utilities, transportation, and other necessities.

A lower inflation rate does not mean prices declined. It means the overall cost of goods and services continued to rise, but at a slower pace than a year earlier.

The Philippine Statistics Authority released the July Consumer Price Index report on Aug. 5, bringing average headline inflation for the first seven months of 2026 to 5.0%.

The year-to-date average remained above the government’s full-year target of 3.0% and its tolerance range of plus or minus 1 percentage point.

On a month-on-month, seasonally adjusted basis, headline inflation was unchanged in July for the second consecutive month.

Core inflation, which excludes selected volatile food and energy items, moderated to 4.2% in July from 4.4% in June.

The slowdown was driven primarily by transport inflation, which eased to 11.9% from 12.8% as pump prices declined and supply conditions improved.

Lower fuel prices in areas outside the National Capital Region helped reduce year-on-year transport inflation.

Inflation in education services and restaurants and accommodation services also eased, helping temper nonfood inflation.

Food inflation held steady at 5.3% in July as lower meat prices and slower increases in vegetable prices offset faster rice inflation.

Meat prices continued to decline because of sustained imports and lower farmgate prices, while vegetable inflation eased amid stable harvests.

Rice inflation accelerated partly because of higher logistics costs, keeping pressure on household food budgets despite improving prices for some commodities.

“Every peso saved from slower price increases means more room for the family budget for food, transport, education and other essential needs,” Department of Economy, Planning, and Development Secretary Arsenio M. Balisacan said. “While challenges remain, particularly in managing food price pressures, these results show that our interventions are making a difference in easing the impact on Filipino households.”

Inflation among the lowest-income 30% of households nevertheless rose to 8.2% in July from 8.0% in June, underscoring the heavier impact of essential-goods inflation on vulnerable families.

The July headline rate was within the Bangko Sentral ng Pilipinas’ forecast range of 5.6% to 6.6% for the month.

The BSP said it would continue monitoring domestic and international developments and their potential effects on inflation and economic growth.

The central bank said it was prepared to take further monetary action as needed to bring inflation closer to the 3.0% target.

As highlighted in the president’s fifth State of the Nation Address, the government’s UPLIFT Committee will continue implementing targeted measures to protect vulnerable sectors from high prices and other economic shocks.

Transport assistance remains among the government’s immediate price-stability measures.

As of July 24, 2026, the government had disbursed PHP 2.09 billion, or 84% of the PHP 2.5-billion Fuel Subsidy Program, benefiting 498,570 public utility vehicles.

Another PHP 356.1 million in fuel assistance had been provided to 89,551 public utility vehicle drivers under the PHP 10-per-liter Fuel Subsidy Program.

The Department of Agriculture is set to complete 380 mechanical drying systems by 2027 to expand postharvest capacity, reduce grain losses, improve rice quality, increase farmers’ incomes, and strengthen domestic rice supply.

The government will also intensify seed and fertilizer distribution in water-abundant rice-producing areas in Southern Luzon, the Visayas, and Mindanao.

Support for drought-affected farmers will continue to minimize production losses and protect food supplies from climate-related risks.

Over the longer term, the government is pursuing power-sector reforms under the Philippine Energy Plan 2023–2050 to reduce dependence on imported fuels.

The reforms include accelerating renewable energy contracts and ensuring the full delivery of awarded capacity, supporting the target of adding 25 gigawatts of renewable energy capacity by 2035.

The coming months will test whether lower transport costs, agricultural interventions, and fuel assistance can also reduce food and low-income inflation, particularly as rice logistics, climate risks, and imported energy costs remain potential sources of price pressure.

“While inflation is moving in the right direction, our work is far from over. We will continue advancing measures to keep essential goods affordable while creating more opportunities for a better quality of life,” Balisacan said.

Sources: Philippine Statistics Authority July 2026 Consumer Price Index report; Philippine Statistics Authority July 2026 Consumer Price Index report for the bottom 30% income households; Department of Economy, Planning, and Development statement dated Aug. 5, 2026; and Bangko Sentral ng Pilipinas inflation guidance.