The Bangko Sentral ng Pilipinas (BSP) expects headline inflation to remain elevated in August, forecasting a range between 5.5 percent and 6.5 percent driven primarily by costlier food staples and domestic fuel.
According to the BSP, price surges in key agricultural commodities continue to exert upward pressure on consumer prices.
“Upward price pressures for the month are likely to be driven by higher rice, vegetable, fruit, and fish prices, partly due to unfavorable weather conditions, and elevated domestic fuel costs,” the BSP said in a statement.
However, the central bank noted that these inflationary forces are expected to be partially offset by lower meat costs, reduced electricity tariffs and the recent appreciation of the Philippine peso.
The latest BSP forecast follows official data from the Philippine Statistics Authority (PSA) showing headline inflation easing slightly to 6.2 percent in July from 6.4 percent in June. Despite the subtle deceleration, July inflation remained significantly higher than the 0.9 percent recorded in the same period last year, bringing the average inflation rate for the first seven months of 2026 to 5 percent.
With overall inflation remaining well above the government’s target range, the BSP emphasized that it will stay vigilant and closely monitor key macroeconomic indicators, particularly incoming inflation data and economic growth figures.
The monetary authority added that it will continue assessing the potential economic fallout from ongoing Middle East geopolitical tensions and localized weather disturbances on the country’s broader inflation and growth outlook.