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Philippines: Inflation seen hitting 1.1% in Oct
THE country’s inflation is forecast to accelerate to 1.1 percent in October from 0.9 percent in September on account of higher fuel and power prices, an economist said on Tuesday.
In a report, Union Bank of the Philippines (UnionBank) chief economist Ruben Carlo Asuncion said the recent drone attacks on Saudi Aramco’s oil-processing facilities — the largest of their kind in the world — “still [have] an impact on Philippine oil prices.”
While most oil companies already slashed prices of gasoline, diesel and kerosene, he said year-to-date adjustments stood at a net increase of P5.61 per liter for gasoline, P4.02 per liter for diesel, and P0.96 per liter for kerosene.
Electricity rates also went up during the month, the UnionBank economist noted.
“After five consecutive months of decline, Meralco (Manila Electric Co.) rates in October was raised to P9.0863 per kWh from September’s P9.0414 per kWh, mainly due to [a] higher generation charge,” Asuncion explained.
The latest amount, however, is still lower than the P9.8766 per kWh recorded in October last year.
Asuncion also said the outbreak of African swine fever (ASF) in the country also affected the price of chicken.
The outbreak “pushed the prices of substitutes due to the shift in demand from pork. As of Oct. 26, 2019, [the] retail price of whole chicken increased to P180 per kilogram from P150/kg in the same date last year,” he explained.
The economist noted, however, that consumer price growth would continue to remain low
in the remaining months of the year due to base effects, lower electricity rates, global oil price stabilization and decreasing rice prices.
“Possible upside risks are higher domestic demand due to [the] holiday season, [the] prolonged effect of ASF and [a] possible tax adjustment scheme,” he said.
The Philippine Statistics Authority will release official inflation data on November 5.
The report comes days after the Bangko Sentral ng Pilipinas reported that economists projected inflation to settle at 2.7 percent this year, higher than its 2.5-percent full-year forecast but still within its 2 to 4-percent target.
In its Third Quarter Inflation Report, the central bank said the latest figure was lower than the 2.9 percent in the June 2019 survey.
WITH A REPORT FROM MAYVELIN U. CARABALLO
Source: https://www.manilatimes.net/2019/10/30/business/business-top/inflation-seen-hitting-1-1-in-oct/652123/