Inflation picks up to 2.5% in Dec
Credit to Author: Anna Leah E. Gonzales| Date: Tue, 07 Jan 2020 16:30:09 +0000
THE country’s headline inflation accelerated to 2.5 percent in December, surpassing analysts’ expectations, on the back of higher prices of oil, food and non-alcoholic drinks, the Philippine Statistics Authority (PSA) announced on Tuesday.
Last month’s figure was higher than November’s 1.3 percent and the 2.1 percent average projected by analysts for the month, but lower than the 5.1 percent recorded in December 2018.
Year to date, consumer price growth hit 2.5 percent, well within the government’s 2.0- to 4.0-percent target and lower than 2018’s 5.2 percent.
“The main source of the upward trend in December 2019 inflation was the annual increase in the index of transport. The annual increment in food and non-alcoholic beverages also contributed to the uptrend in inflation in December 2019,” Deputy National Statistician Rosalinda Bautista explained in a briefing.
In particular, commodities with increased annual rates include petroleum and fuels for personal transport equipment (8.7 percent from -4.8 percent in November); jeepney fares (0.6 percent from -4.9 percent); and ferry or ship fare s (5.2 percent from 3.0 percent).
For food and non-alcoholic beverages, higher annual mark-ups were observed in vegetables (8.2 percent from 1.0 percent) and fish (7.4 percent from 2.5 percent).
Rice prices, meanwhile, reached -6.8 percent, compared to -8.3 percent in November.
Annual increments in alcoholic beverages and tobacco also pushed up inflation last month.
Inflation in the National Capital Region hit 2.8 percent, lower than the 4.8 percent recorded in December 2018, but higher than the 1.5 percent recorded in November.
The acceleration was attributed to increases in the indices of food and non-alcoholic beverages; alcoholic beverages and tobacco; housing, water, electricity, gas and other fuels; furnishing, household equipment and routine maintenance of the house; health; communication; recreation and culture; and restaurant and miscellaneous goods and services.
Food groups with higher annual upticks are vegetables, particularly onion and mustard; fish, specifically galunggong and tulingan; and calamansi.
In areas outside Metro Manila, consumer price growth also accelerated to 2.4 percent from 1.2 percent in November, but decelerated from 5.3 percent in December 2018.
‘Not a cause for alarm’
Malacañang downplayed the latest inflation data on Tuesday, saying Filipinos should not worry about it.
“The uptick in [the] inflation rate in December 2019 to 2.5 percent from November 2019’s 1.3 percent should not be a cause for alarm. It remains well within our target range of 2 percent to 4 percent,” Palace Spokesman Salvador S. Panel assured in a statement.
“We consider high inflation, which peaked at 6.7 percent in 2018, as a thing of the past,” he said, and cited the National Economic and Development Authority (NEDA) in explaining that increases in the “prices of both food and non-food items” was “due to the impact of typhoons and rising oil prices observed” last month.
In a separate statement, Socioeconomic Planning Secretary Ernesto M. Pernia said that although inflation was steady, “the government must remain vigilant and proactive in managing the impact of potential sources of price pressures this year, such as typhoons, continuing presence of African Swine Fever in the country, and the heightened conflict in the Middle East.”
According to the NEDA chief, the recovery and rehabilitation plans for typhoon-affected areas must be immediately implemented and the production support programs for affected farmers and fishermen must be fast-tracked.
He also cautioned that escalating tensions in the Middle East might disrupt global oil supply, which could lead to a surge in the prices of petroleum products and overall inflation.
“The government should effectively manage expectations at the domestic front and be vigilant against any unwarranted increase in pump prices, considering that the last tranche of excise tax increase on fuel products will be implemented this month,” Pernia said.
WITH A REPORT FROM CATHERINE S. VALENTE