MANILA, Philippines — The Philippines’ headline inflation rate continued to ease in May 2025, slowing to 1.3 percent from 1.4 percent in April, the Philippine Statistics Authority (PSA) reported on Thursday.

This marks the lowest inflation rate recorded since November 2019, when it stood at 1.2 percent.

The latest figure brings the country’s average inflation rate from January to May 2025 to 1.9 percent. It also reflects a sharp decline from the 3.9 percent inflation rate registered in May 2024.

Key drivers of the downtrend

The deceleration was mainly driven by the slower annual increase in the index of housing, water, electricity, gas, and other fuels, which eased to 2.3 percent in May from 2.9 percent in April.

Other contributors to the downtrend include:

• Restaurant and accommodation services, which slowed to 2.0 percent from 2.3 percent;
• Transport, which posted a faster annual decline of 2.4 percent from a 2.1 percent drop in April;
• Furnishings, household equipment and routine household maintenance, with a slower increase of 2.0 percent from 2.1 percent.

In contrast, certain commodity groups saw slightly higher inflation in May, including:

• Alcoholic beverages and tobacco, 3.8 percent from 3.7 percent;
• Information and communication, 0.4 percent from 0.3 percent;
• Recreation, sport and culture, 2.2 percent from 2.1 percent; and
• Education services, 4.3 percent from 4.2 percent.

The rest of the commodity groups maintained their April growth rates, with financial services still registering zero inflation.

Top contributors to headline inflation

The top three contributors to May 2025’s overall inflation rate were:

1. Housing, water, electricity, gas and other fuels (37.1% share or 0.5 percentage point);
2. Food and non-alcoholic beverages (25.7% share or 0.3 percentage point); and
3. Restaurants and accommodation services (15.5% share or 0.2 percentage point).

Food inflation remains steady

Food inflation held steady at 0.7 percent in May 2025, significantly lower than the 6.1 percent recorded in May 2024. Food contributed 0.2 percentage point or 18.7 percent to overall inflation during the month.

The top contributors to food inflation were:

• Meat and other parts of slaughtered land animals, contributing 1.5 percentage points (216.6% share);
• Fish and other seafood, 0.9 percentage point (133.6% share); and
• Milk, other dairy products and eggs, 0.4 percentage point (55.8% share).

Core inflation steady at 2.2%

Core inflation, which excludes volatile food and energy items, remained unchanged at 2.2 percent in May 2025, but slower than the 3.1 percent recorded in May 2024.

Regional inflation

The statistics bureau said that inflation in NCR dropped to 1.7 percent in May from 2.4 percent in April. The rate was 3.1 percent in the same month last year.

The slowdown was mainly attributed to:

• Housing, water, electricity, gas and other fuels, which slowed to 3.1 percent from 5.1 percent;
• Restaurant and accommodation services, which decreased to 1.2 percent from 1.9 percent; and
• Food and non-alcoholic beverages, which eased to 2.2 percent from 2.5 percent.

Declines were also observed in:

• Alcoholic beverages and tobacco, 2.3 percent from 2.5 percent;
• Health, 1.5 percent from 1.6 percent; and
• Personal care and miscellaneous goods and services, 2.3 percent from 2.4 percent.

Inflation in AONCR remained at 1.2 percent in May 2025, unchanged from April but down from 4.1 percent a year ago.

Higher inflation was observed in:

• Health, 2.6 percent from 2.5 percent;
• Recreation, sport and culture, 2.5 percent from 2.4 percent;
• Education services, 5.0 percent from 4.8 percent;
• Restaurants and accommodation services, 2.4 percent from 2.3 percent; and
• Personal care and miscellaneous goods and services, 2.6 percent from 2.5 percent.

However, the indices for clothing and footwear and furnishings and household equipment recorded slower growth, while transport posted a steeper annual decline at 2.4 percent.

Nine regions in AONCR posted either slower inflation or a faster annual decline. Region X (Northern Mindanao)posted a zero percent inflation rate. The lowest declines were recorded in Region XII (SOCCSKSARGEN) at 1.1 percent and BARMM at 1.6 percent. The highest rate was seen in Cordillera Administrative Region (CAR) at 2.5 percent.