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July inflation accelerates to highest in almost 3 years

( | Updated August 5, 2014 - 11:30pm

MANILA, Philippines (Xinhua) - Inflation climbed to 4.9 percent in July on the back of higher prices of food and utilities, the local statistics agency said today.

The Philippine Statistics Authority (PSA) said that the July inflation rate was the highest recorded in the country since October 2011, when inflation hit 5.2 percent.

Excluding selected food and energy core items, core inflation also grew faster at 3 percent in July, from 2.8 percent recorded the previous month.

Data released by PSA showed that the heavily-weighted food and non-alcoholic beverages index rose to 8.2 percent last month. Prices of utilities, transport, and education also picked up in July.

"Rice prices remained at high levels in July as supply tightness continued to persist in the market," the National Economic and Development Authority (NEDA) said in a statement.

NEDA Director-General Arsenio Balisacan said that rice prices grew by 14 percent year on year last month, higher than the 13.6 percent hike recorded in June.

By region, PSA said the highest inflation rate remained in Eastern Visayas in central Philippines at 8 percent. Many provinces in Eastern Visayas experienced tightness in food supply after the region was battered by typhoon Haiyan last November.

Inflation in the January to July period averaged 4.3 percent, which was at the high-end of the government's 3 to 5 percent target for 2014. 

Balisacan, however, said that the Monetary Board's recent move of hiking interest rates by 25 basis points would put a brake on potential price increases in the coming months.

NEDA pushed for the implementation of short-term interventions such as importation to prop up food supply.

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