Finance Secretary Ralph G. Recto highlighted that the country’s inflation rate stays firmly within the target range, reflecting the government’s effective interventions to ease supply pressures for key food items, especially rice.

“We are very much on track in keeping our inflation within our target band for the entire year despite some challenges, such as strong successive typhoons that affected the agriculture sector. Patuloy po ang pagtulong ng gobyerno para siguruhing mabilis na makakaahon ang mga naapektuhan ng mga nagdaang bagyo at maging mas abot-kaya ang mga bilihin lalo na sa paparating na Pasko,” the Finance Chief said. 

The year-to-date inflation rate declined to 3.2% despite the slight uptick in November 2024 to 2.5% from 2.3% in the previous month. This is well within the government’s target band of 2% to 4% for the year. 

In November 2023, the inflation rate was higher at 4.1%.

The primary sources of the slight acceleration of headline inflation in November were food and non-alcoholic beverages (from 2.9% year-on-year to 3.4%). 

This was mainly driven by the slight uptick in the prices of vegetables due to the strong successive typhoons; fish/other seafood; and meat such as pork. 

Non-food inflation also registered a slight uptick in November 2024 at 1.9% compared to 1.8% in October due to transport’s slower year-on-year decrease (from -1.2% to -2.1%).

Core inflation, which excludes selected volatile food and energy items, remains moderate at 2.5% year-on-year. This is aligned with the cumulative 50-basis-point rate cut by the Bangko Sentral ng Pilipinas (BSP), signaling a proactive approach to managing inflation and leaving room for another rate cut this month.

Rice prices on its downward trend

Rice inflation has continued its downtrend from 9.6% in October 2024 to 5.1% in November this year as a result of the implementation of Executive Order (EO) No. 62 in July 2024, which lowered import tariffs on rice. 

The average retail price of imported rice for the second half of November 2024 went down by PHP 3.65 per kilogram (kg) from the second half of June 2024, prior to the implementation of the said EO.

This tempered the effects of high prices of food commodities due to the onslaught of typhoons Nika, Ofel, and Pepito in November 2024, and the lingering impact of typhoons Kristine and Leon in late October 2024.

The continued drop in rice prices, including the set up of more Kadiwa Stores nationwide, has benefitted the bottom 30% of households as headline inflation for the said group declined to 2.9% in November 2024 from 3.4% in the previous month.

Rice, which makes up 31.7% of the inflation rate for this group, saw a decrease in inflation to 5.4% year-on-year in November from 10.2% in October. 

The DOF expects the downward trend in rice prices to continue through December given the decrease of rice prices in the international market.

The DOF also calls on traders to ensure that reductions in tariffs are being passed on to consumers.

Government’s Intensified Interventions to Mitigate Food and Non-Food Inflation

To enhance local rice production and address the needs of rice farmers, the executive department supports the extension of the Rice Competitiveness Enhancement Fund (RCEF) until 2031 through the amendment of the Rice Tariffication Law (RTL), including the expected increase of the Rice Competitiveness Enhancement Fund (RCEF). 

The Department of Agriculture (DA), for its part, will continue to expand the Kadiwa ng Pangulo sites to 179 by the end of the year and 300 by mid-2025, providing affordable rice under the Rice-for-All and P29 programs. 

To help Filipinos recover quickly from the impact of typhoons, the government continues to deliver financial aid to typhoon-hit areas, including humanitarian assistance to affected families by the Department of Social Welfare and Development (DSWD). 

The DA also directed the Philippine Crop Insurance Corporation (PCIC) to expedite claims processing and prepare for potential agricultural damage. 

In terms of interventions against African swine fever (ASF), the DA targets to procure 600,000 ASF vaccine doses and will prioritize free distribution to small swine raisers, which account for more than 70% of the country’s swine inventory. 

In addition, the DA will explore incentives for ASF-affected hog raisers to adopt biosecurity measures, including continued indemnification payments. 

In line with the holiday season, the Department of Industry (DTI) has released the 2024 Noche Buena Price Guide, listing prices for 236 products across 12 categories to help consumers make informed choices during the holiday season and promote price stability and affordability. 

Broad-based measures to mitigate non-food inflation are also in place, such as the staggered implementation of electricity rate hikes; the proposed amendments to the Electric Power Industry Act (EPIRA); and the proposed enhanced lifeline program of the Manila Water Co. in 2025 that will offer higher discounts to support low-income customers. 

The government also continues to implement extended exemption of trucks catering to agriculture goods from toll hikes until the end of 2024, while the Land Transportation Franchising and Regulatory Board (LTFRB) is considering reducing surge rates for transport network vehicle services (TNVS) by 50%.

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