June inflation seen hitting at 4.9%: DOF bulletin

July 3, 2018

Inflation in June likely inched up to 4.9 percent year-on-year, up from the previous month's 4.6 percent due to base effects and 0.35 percent month-on-month increase, the Department of Finance (DOF) said Tuesday in its economic bulletin.

June 2017 inflation rate was at 2.5% year-on-year and zero month-on-month, the DOF said.

Month-on-month inflation adjustment may be due mainly to two items---2.43 percent month-on-month rise in education during the opening of classes and 2.27 percent rise in vegetable prices that usually accompanies incessant rains at the start of the wet season.

Food prices contributed to the year-on-year uptick mainly due to vegetables while month-on-month inflation of fish and rice price moderated to 0.11 percent and 0.1 percet, respectively.

Price increase from sin products continues to be double digit year-on-year even as the month-on-month rate plunged to 0.3 percent from 0.81 percent last May. For the June inflation rate, sin products contribute as much as 0.46 percentage points year-on-year.

Non-food price also sees 0.33% month-on-month increase, driven by education and petroleum products but tempered by the decline in electricity rates. The P0.90-P1/li price rollback last June 25 likely came after the survey. DMS