Philippine inflation slowed for a third straight month to 6.2 percent in July from 6.4 percent in June, as improved fuel supply conditions helped temper transport costs amid easing tensions in the Middle East.

The Philippine Statistics Authority (PSA) said the latest print brought average inflation for the first seven months of the year to 5 percent, still above the government's 2- to 4-percent target range.

Biggest contributor to inflation slowdown

The transport index was the biggest contributor to the slowdown, with inflation easing to 11.9 percent from 12.8 percent and accounting for 57.4 percent of the overall deceleration. Gasoline inflation slowed to 34.1 percent from 39.2 percent, while inflation for passenger transport by road eased to 5.3 percent from 5.4 percent.

Food inflation, meanwhile, remained at 5.3 percent, as lower meat prices and slower increases in vegetable prices offset faster rice inflation.

Cautious over geopolitical risks

Presidential Communications Undersecretary Claire Castro said the government welcomed the slowdown but remained cautious over geopolitical and weather-related risks.

"These positive developments are good news, but the administration will continue to monitor the situation since there are still lingering tensions in the Middle East and the effects of El Niño continue to threaten prices of food and energy," Castro said.

"That is why the government continues to implement targeted measures to protect Filipino families and keep goods affordable. Our overall goal remains the same: lower everyday expenses, strengthen food and energy security, protect the purchasing power of Filipino families, and sustain economic growth that will benefit every household," she added.

Economy, Planning and Development Secretary Arsenio Balisacan likewise welcomed the lower print, noting that government measures supporting price stability include assistance programs for the transport sector.

Work far from over

"While inflation is moving in the right direction, our work is far from over. We will continue advancing measures to keep essential goods affordable while creating more opportunities for a better quality of life," Balisacan said.

The government said it would continue implementing targeted measures through the UPLIFT Committee to shield vulnerable sectors from elevated prices and other economic shocks.