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Inflation rate slows down as Christmas season nears

December 07, 2018 - Friday 4:12 PM by Lovely Carillo

File photo by ARJOY M. CENIZA

The country’s economic managers hope that the slow-down in the inflation rate as the Christmas season nears will help alleviate the struggles of poor Filipinos.

The Philippine Statistics Authority (PSA) on Wednesday reported a 0.3 percent month on month decline in the inflation rate, the lowest since last July’s 5.7 percent. PSA noted the inflation rate eased to 6.0 percent in November from 6.7 percent in October 2018,

This came amid government efforts to tame rising prices, indicating a downward path, the economic managers said in a joint statement.

As of November 2018, year-to-date inflation averaged 5.2 percent. This is 1.2 percentage points above the high end of the government’s inflation target range of 2.0 to 4.0 percent, but slightly below the 5.3 percent emerging forecast of the Bangko Sentral ng Pilipinas for 2018.

Food and non-alcoholic beverages continue to be the main drivers of inflation. Last month, it decelerated to 8.0 percent from 9.4 percent in October 2018. This was, however, significantly higher than the 3.0 percent in November 2017. 

Food inflation slowed to 7.7 percent in November from the previous month’s 9.2 percent.  This was caused by the improvement in the supply of key agricultural commodities such as rice, fish and seafood, meat, vegetables, corn, and fruits. 

This is a positive development in the government's commitment to manage inflation. But mitigating measures under various government issuances, including those prescribed in Administrative Order 13, issued by the President should be continuously implemented and strictly monitored. Most importantly, we must ensure the timely arrival of rice imports to compensate for the lost palay harvest in the third quarter of the year.

The economic managers expect rice prices to further go down with the recent passage of the Rice Tariffication bill in Congress. However, it cautioned that since this measure opens the rice market to qualified players, it should be coupled with the full operationalization of the National Window System to allow seamless imports processing and to avoid unwarranted delays.