It was also way below the expected rate for the month.
Last Friday, June 5, the Philippine Statistics Authority (PSA) announced that the year-on-year headline inflation in the Philippines slowed down to 6.8% in May, down by 0.4% percentage points from the 7.2% logged in April.
According to the PSA, slower increases in fares, food prices, and housing costs, as well as tje lower domestic prices of selected petroleum productsx helped lower inflation.
The inflation in May was below the Bangko Sentral ng Pilipinas (BSP)’s forecast range of 7.1 percent to 7.9 percent for the month.
PSA Undersecretary and National Statistician Claire Dennis Mapa said the average inflation rate from January to May 2026 was 4.5 percent. Although, that is higher than the BSP’s target of 3.0 percent for the year.
Inflation for households with incomes in the lowest 30 percent of the population declined from 8.5 percent in April to 8.4 percent in May, further noted the BSP.
Based on PSA data, inflation in the transportation sector dropped to 16.2 percent in May, which had a significant impact on the overall decline in inflation as the price of diesel and gasoline increased more slowly.
There was a slow increase in the prices of LPG and kerosene, despite the imposition of the excise tax suspension.
Lower transport costs tempered the increase in the prices of key food items such as vegetables and fish.
The food and non-alcoholic beverages sector also contributed, recording a 5.7 percent inflation rate.
Mapa said that the prices of vegetables, root crops, bananas, onions, fish and other seafood are increasing at a slower pace, while pork prices also continue to decline.
Improved supply conditions of the meat drove the decline in meat prices.
Meanwhile, rice prices remained elevated relative to year-ago levels but declined month-on-month in May following the recent dry season harvest.
Hence, the decline in food prices is still the leading factor in the decline in inflation, including rice and other cereal products.
As for housing, water, electricity, gas and other fuels sector recorded an inflation rate of 7.8 percent.
On a month-on-month seasonally adjusted basis, headline inflation declined from 3.0 percent in April to -0.6 percent in May, added the BSP.
In contrast, core inflation, which excludes volatile food and energy items, rose from 3.9 percent in April to 4.1 percent in May.
“The BSP will take necessary actions to ensure inflation returns to its 3-percent target, in keeping with its primary mandate to ensure price stability,” the central bank said in a separate statement.
President Ferdinand Marcos also previously implemented the Unified Package for Livelihoods, Industry, Food, and Transport (UPLIFT) to reduce the impact of inflation on the people.
UPLIFT provides assistance to sectors affected by rising commodity prices and helps stabilize the supply and prices of basic goods.
UPLIFT was launched through Executive Order No. 110 signed on March 24, 2026 as the government’s response to the increase in oil prices in the global market and other economic challenges.