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Philippines: Aug inflation seen at 3.1%
MANILA, Philippines – The country’s inflation rate in August likely accelerated to 3.1 percent as prices of food and petroleum products increased during the period, the Department of Finance (DOF) said.
In his latest economic bulletin, Finance Undersecretary Gil Beltran said inflation may have risen to 3.1 percent last August, as compared to the 1.8 percent recorded the same month in 2016.
This is likewise higher than the 2.8 percent inflation rate posted in July 2017.
“The inflation forecast for August is 3.1 percent. The main reason is food and oil from petroleum products,” Beltran said in an interview.
Based on Beltran’s estimates, the price index for food and non-alcoholic beverages in August may have increased to 3.7 percent from 2.4 percent the same month last year, and 3.3 percent the previous month.
Beltran, also the DOF’s chief economist, said the rise in food prices was due to seasonal factors as lean months have started and supply of rice has become thinner.
“For food, we are reaching the point wherein the supply in the market is low because it’s the rainy season, but once harvest time comes (in October), the prices will go back (down),” Beltran said.
Meanwhile, Beltran estimated the housing, utilities and fuel index for August may have also increased to 2.7 percent from 2.2 percent in July, due to increases in the prices of diesel and gasoline.
For its part, prices of diesel in Metro Manila have increased to P32.54 per liter from P30.56 in July, and P26.01 per liter in August 2016.
Gasoline prices also climbed to P45.27 per liter from P43.37 per liter in July, and P38.80 per liter in August last year.
However, the DOF economist pointed out the recent bird flu incident in Pampanga and Nueva Ecija had not affected inflation during the month of August as prices of poultry products have even dropped.
He said the peso exchange rate, which breached the 51 to $1 mark last August, also had very minimal impact on inflation.
In July, the country’s inflation inched up to 2.8 percent from the revised 2.7 percent in June, bringing the average inflation to 3.1 percent in the first seven months of the year.
Bangko Sentral ng Pilipinas Governor Nestor Espenilla Jr. said inflation is seen to remain close to the midpoint of the two to four percent inflation target from 2017 to 2019.
He said this gives the BSP the flexibility to assess its policy options with due consideration of external and domestic factors.
Meanwhile, Beltran said price stability would “continue to be a pillar of solid macroeconomic fundamentals conducive for robust growth.”
Source: http://www.philstar.com/business/2017/09/04/1735454/aug-inflation-seen-3.1