July inflation fastest in 3 years, says statistics office

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MANILA—Consumer prices rose by 4.9 percent in July, the fastest rate in nearly three years, as food and fuel costs remained high, prompting the central bank to send more hawkish signals for possible further interest rate hikes.

The authorities were confident, however, that inflation would still average within the state’s official target for the year, but administration officials were urged to take steps to secure the country’s food supply to stabilize prices.

“Rice prices remained at high levels in July 2014 as supply tightness continued to persist in the market,” Socioeconomic Planning Secretary Arsenio Balisacan said in a statement Tuesday.

The Philippine Statistics Authority reported Tuesday that consumer prices rose by 4.9 percent in July, the fastest rate since late 2011. The reading for July, which was faster than June’s 4.4 percent, hit the top end of the central bank’s forecast of 4.1 to 4.9 percent.

Apart from food, the prices of housing, water, electricity, fuel, health, transport, recreation, and education were higher, year-on-year, in July.

“This confirms our assessment that the economy could see more near-term increases in select food prices, partly due to weather-related supply concerns,” Bangko Sentral ng Pipipinas Gov.  Amando M. Tetangco Jr. told reporters after inflation data were released.