The Inflation Rate For June In The Philippines Rises To 5.2%

The Inflation Rate For June In The Philippines Rises To 5.2%

The June inflation rate in the Philippines is currently at 5.2%, which is 0.3% higher than the estimated 4.9%. How exactly would this affect consumers?

You might have read in the news recently that the inflation rate in the Philippines is at 5.2%. Looking at it from a very straightforward point of view, it means everything is going to cost more, right? 

Is it a good thing that our inflation rate has increased? Is it a bad thing? And what effect would it have on regular consumers like us?

We’re here to answer all those questions here. 

Inflation rate in the Philippines is currently at 5.2%

inflation rate in the Philippines


The Philippine Statistics Authority (PSA) reported that the inflation rate for June was 5.2%, which was 0.6% higher than the inflation rate in May.

This figure has exceeded the estimates by both the government and market, which believed that the inflation would only be at about 4.9%.  The last the inflation rate in the Philippines was this high was back in October 2011.

The PSA attributed this increase to the “higher annual rate posted in the heavily-weighted food and non-alcoholic beverages index at 6.1%.”

“Year-on-year inflation in [National Capital Region] NCR accelerated by 5.8 %in June 2018. It was pegged at 4.9% in the previous month and 3.1% in June 2017,” the PSA continued.

Since January, the monthly inflation rates have exceeded the government’s predictions and the BSP’s forecast of 4-4.5% for the entire year.

How would a higher inflation rate affect consumers?

inflation rate in the Philippines


To put it simply, the inflation rate is the rate at which the cost of goods increase. This means that with a 5.2% inflation rate, goods that cost 100 pesos would now cost 105.2 pesos.

A higher inflation rate would mean that the cost of goods and services would go up, and the purchasing power of currency would drop.

Inflation affects the cost of all goods

A higher inflation rate will affect the cost of all goods and services. That’s because as the purchasing power of currency drops, vendors will have a hard time keeping prices stable.

In order to offset the rising cost of goods, vendors will be forced to raise their prices.

Here are some examples of how a 5.2% increase can affect the cost of goods:

  Current price Price with 5.2% inflation
1 kilo of rice 45.64 pesos 48 pesos
1 liter of milk 77.33 pesos 81.35 pesos
1 kilo of chicken breast 163.38 pesos 171.87 pesos
1 meal at McDonald’s 150 pesos 157.8
1 dozen eggs 76.64 pesos 80.62

The cost could even potentially increase as gas prices are also affected by inflation. Higher gas prices would mean that the delivery cost of goods would increase, which would then be shouldered by consumers.

Inflation isn’t always a bad thing

However, this doesn’t necessarily mean that inflation is always bad thing. In moderate amounts, inflation can be a good thing.

Inflation can help stimulate the economy since if it’s predicted that the inflation will increase, more people will start buying while the inflation rate is still low.

The government also benefits from inflation, since it helps erode their debt. This can help increase the country’s income since they would have to spend less on paying debt.

Of course, too much inflation is very bad. An uncontrollable increase in inflation can reduce the value of money, increase the cost of goods, and even cause low growth and unemployment.

That’s why inflation should be always under control by the government, so that the prices of goods and services don’t fluctuate rapidly that the public can’t keep up.


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