DECEMBER INFLATION AT 7-MONTH LOW

Government interventions to hasten the movement of agricultural products and the lower global oil prices bring down inflation to 5.1 percent from six percent in November

The headline inflation rate further slowed down to 5.1 percent in December 2018, the Philippine Statistics Authority (PSA) announced in a press briefing Friday, Jan. 4.

“This is the lowest annual rate since June 2018,” the agency said. The December figure is lower than the six percent recorded in November, 6.7 percent in September and October, 6.4 percent in August, 5.7 percent in July and 5.2 percent in June.

Headline inflation refers to the rate of change in the weighted average prices of all goods and services in the consumer price index basket.

In Central Visayas, inflation decelerated to 5.3 percent. Although slightly higher than the national figure, this is still lower than the six percent rate recorded in November.

National Economic and Development Authority (Neda) 7 Director Efren Carreon attributed the higher rate to the higher inflation for food and non-alcoholic beverages, furnishings, household equipment and house maintenance. He said that among selected food items, Central Visayas had higher inflation for corn, meat, fish, oils and fats, and sugar and confectionery products compared to the national figures.

“Central Visayas is not a major agri food and fish producer. Thus, we source some of these from other regions. The higher prices for these commodities are due to transport and storage,” Carreon explained.

Rice inflation in the region slightly slowed down from 5.9 percent in November to 4.8 percent last month. Inflation rates for bread and corn also eased to 4.6 percent and 7.4 percent, respectively. The same went for fruits by -0.4 percent and vegetables by seven percent.

Meanwhile, inflation for meat and fish slightly went up. Meat inflation rose by 9.3 percent from 8.8 percent in November. Fish in- flation, on the other hand, rose by 13.4 percent in December from 11.6 percent the previous month.

Cebu Chamber of Commerce and Industry (CCCI) president Antonio Chiu said a lower inflation rate is good news for the economy.

However, he noted that the lower inflation rate was due largely to a significantly lower price of oil, which is dictated by world market prices.

Chiu said the inflation rate will remain stable in the coming months if global oil prices continue to plunge. But he warned that the country has no control over it.

“Our economic mangers should continue to adopt measures to ensure a sustainable situation to control inflation,” said Chiu.

The CCCI official pointed out the need to fix the state of the country’s agriculture sector because when food prices go up, it is usually workers that are severely affected.

“Agriculture remains to be a big mess and food prices can easily spike again anytime. Food production efficiency continues to be very low, particularly in rice, even though the Philippines possesses the best rice growing technology in the world,” Chiu said.

Production efficiency in agriculture is measured in yield per hectare. Chiu said the country’s yield per hectare in rice is less than half of what Vietnam produces, using Philippine technology.

In a joint statement, the country’s economic managers welcomed the lower inflation rate booked in December, as it signified that the mitigating measures in force were broadly effective.

The economic team vowed to take swift and decisive measures to tame inflation as directed by President Rodrigo Duterte. It promised to exert all efforts to bring inflation within the government’s target range of two to four percent, and ensure price stability all year round.

“While we can say that the worst seems over, given the signs of easing price pressures, we continue to be vigilant of possible risks,” the group, composed of the Department of Finance, Neda and the Department of Budget and Management, said.

With the expected signing into law of the Rice Tariffication Bill, rice prices are expected to decline by as much as P7 per kilo.

The economic team said it will push for the full operationalization of the National Single Window, step up anti-smuggling measures and urge the Philippine Competition Commission to be vigilant in curbing anti-competitive behavior, particularly in the rice market. /