Philippines inflation speeds up to 1.5% in August

The Philippines' headline inflation accelerated to 1.5 percent in August, marking the fastest pace in five months and exceeding the 1.3% median forecast in a Reuters poll.

This figure aligns with the Bangko Sentral ng Pilipinas' (BSP) August inflation forecast of one to 1.8 percent, and the average inflation rate from January to August is 1.7 percent.

The primary driver for the increased inflation in August was the rise in prices for food and non-alcoholic beverages, which saw a 0.9 percent increase.

Specifically, the prices of vegetables experienced a significant surge of 10 percent in August after monsoon rains ravaged crops, reversing a previous dip.

The surge in vegetable prices offset a record 17% drop in rice prices.

Prices of fish and seafood also contributed to the food inflation uptrend, with a 9.5 percent price increase in August compared to 6.3 percent in the preceding month.

Despite the uptick, the BSP expects inflation to fall below its 2 to 4 percent target range this year and gradually return to that band in 2026 and 2027.