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The Philippines’ economic managers insist that high inflation amid the pandemic is all but transitory. Signs of easing to a level within the target range, however, have yet to be seen.
In a briefing on Friday, November 5, the Philippine Statistics Authority reported that inflation inched down to 4.6% in October from 4.8% in September – still elevated.
The slowdown was due to prices of meat, vegetables, and fish rising at a slower pace.
Food inflation slowed to 5.6% in October from 6.5% in September.
But fuel prices had increased by 32.9% or at least a peso per liter every week of October, pushing up transportation costs.
Transport inflation accelerated from 5.2% to 7.1%, while private transport jumped from 16.7% to 25.5%.
“Many countries, particularly net oil importers such as the Philippines, are feeling the impact of the rising world oil prices. We will continue monitoring the global developments so we can urgently respond to the impact of elevated oil prices on ordinary Filipinos, especially our [public utility vehicle] drivers,” said Socioeconomic Planning Secretary Karl Chua.
African swine fever also remained a problem. Pork imports have not brought prices down within the desirable level.
Meat inflation eased to 11.9% in October from 15.6% in September. Pork inflation remained high at 23.3% in October, although slower than the 36.4% recorded in September.
Average inflation for January to October stood at 4.5%.
Inflation, so far, has only settled within the target range of 2% to 4% once in 2021.
Despite this, Bangko Sentral ng Pilipinas (BSP) Governor Benjamin Diokno has repeatedly said that the upticks are transitory.
“Based on available evidence, I will side with ‘team transitory,'” Diokno said last October.
The BSP has continued to push back on rate hike calls to support economic recovery.
ING Bank Manila senior economist Nicholas Mapa expects the central bank to maintain its current policy setting for the rest of 2021, but sees an adjustment from monetary authorities by the second quarter of 2022. – Rappler.com