October inflation at 7.8% batters household budgets

Filipino households face a worsening cost-of-living squeeze as inflation surged to 7.8 percent in October, with soaring transport costs, higher electricity expenses, and persistently expensive rice further eroding consumers’ purchasing power.

Latest data from the Philippine Statistics Authority (PSA) released on Thursday showed that inflation accelerated from 7.2 percent in September and 1.7 percent a year earlier, reaching its highest level since November 2022, when inflation stood at 8.0 percent.

The latest reading brought average inflation for the first 10 months of the year to 5.6 percent, highlighting the growing financial strain on households as essential goods and services become increasingly expensive.

Transport costs emerged as the biggest driver of the latest acceleration, with inflation jumping to 20.1 percent from 14.6 percent in September, reflecting the impact of elevated fuel prices on consumers.

Inflation for housing, water, electricity, gas and other fuels also climbed to 9.3 percent from 8.4 percent, adding pressure on household utility expenses.

Together, transport and housing-related costs accounted for 3.7 percentage points of overall inflation, underscoring the heavy burden of energy prices on consumers.

Despite some relief in food prices, rice remained a major source of pressure, with inflation accelerating to 20.7 percent from 20.3 percent in September.

Corn inflation also climbed to 19.3 percent from 17.3 percent, while fruit prices increased 10.8 percent, faster than the previous month’s 8.7 percent.

Overall food inflation, however, eased to 6.4 percent from 6.8 percent, supported by slower price increases for fish and vegetables.

Fish inflation moderated to 5.0 percent from 7.4 percent, while vegetable inflation slowed to 5.7 percent from 10.5 percent.

Food and non-alcoholic beverages nevertheless remained the largest contributor to overall inflation, accounting for 30.2 percent of the total.

Meanwhile, core inflation, which excludes selected volatile food and energy items, accelerated to 5.4 percent from 4.8 percent, indicating broader price pressures across the economy.

Consumers outside Metro Manila faced an even heavier burden, with inflation reaching 8.2 percent compared with 5.9 percent in the National Capital Region.

To cushion the impact, the Department of Economy, Planning, and Development (DEPDev) said the government is strengthening food production, improving logistics and expanding targeted assistance for sectors affected by higher energy costs.

The government began rolling out P3 billion in fuel subsidies in October for around 300,000 farmers, fisherfolk, and agricultural delivery-truck drivers.

Farmers and fisherfolk will receive a one-time P5,000 subsidy, while delivery-truck drivers will receive P2,000 weekly to help offset higher fuel expenses.

The Department of Agriculture also reported releasing P11 billion in production support, cash assistance, and other interventions as of 21 October.

Meanwhile, energy authorities are pursuing measures to secure electricity supply amid El Niño conditions and contain power costs, including the temporary suspension of the Wholesale Electricity Spot Market Reserve Market.

DEPDev Secretary Arsenio Balisacan said the government would continue implementing measures to ease inflationary pressures and protect vulnerable sectors.

“We will continue strengthening targeted interventions that support producers, improve supply, and provide relief to vulnerable sectors,” Balisacan said.

“By improving agricultural productivity and logistics and addressing constraints in food and energy supply, we can ease price pressures, protect purchasing power, and build greater resilience against external shocks.”