Andrea E. San Juan, October 26, 2023
The National Economic and Development Authority (Neda) said inflation may start easing this month as it is seeing less pressure on domestic prices because of the availability of certain food items and the “timely” arrival of imports.
Socioeconomic Planning Secretary Arsenio M. Balisacan said the decline in the prices of some commodities in the past few weeks due to the ongoing harvest season should ease inflationary pressures.
“At least for the Philippines, our agriculture people are telling us that there is good production and recovery from the floods, recent floods and so we are likely to have a good harvest and harvest is now ongoing. That could reduce the pressure on domestic prices,” Balisacan told reporters on the sidelines of the 2023 Arangkada Philippines Forum held on Wednesday in Pasay City.
“The inflation that we saw in September was a bit on the high side but we hope that inflation in the coming months is much more improved,” he added.
Among the main drivers for inflation in September 2023 was expensive rice as data from the Philippine Statistics Authority (PSA) showed rice inflation averaged 17.9 percent, the highest in 14 years or since March 2009 when rice inflation reached 22.9 percent.
With the lifting of the price ceiling on rice a few weeks ago, he said, “I think I would be very surprised if the inflation and rice will get a rate that we saw in September because you know, as the harvest season…prices declined a bit in the past couple of weeks.”
He added that this should have tempered the pressure for upward prices as retail prices have evidently adjusted “quickly” to the market conditions.
“And so with current availability of supplies and the timely arrival of imports, I think that we should see less of that pressure,” the NEDA chief said.
President Ferdinand R. Marcos Jr. issued Executive Order No. 39 last month in response to the unusual surge in the price of rice last month despite the country’s sufficient supply of the food staple. He attributed it to the price manipulation by hoarders and smugglers.
EO 39 imposed a P41 per kilogram (kg) price cap for regular milled rice (RMR) and P45 per kg for well-milled rice (WMR) nationwide. While rice prices have declined in recent weeks, Balisacan said the government is more apprehensive about “longer term trend.” “We are hoping that the effects of the El Niño are not as bad…will not be as bad as initially projected.”
PSA said inflation averaged 6.1 percent in September 2023. Inflation was at 6.9 percent in September 2022 and 5.3 percent in August 2023.
The inflation rate in September was the highest since May 2023 when inflation was at the same rate. Prior to this, the highest rate was in April at 6.6 percent.
Source: https://businessmirror.com.ph/2023/10/26/bumper-crop-will-temper-inflation/