APEC central banks: Inflation may worsen as oil soars
MEMBER countries at the latest meeting of the Asia Pacific Economic Cooperation (APEC) expressed concern that the fluctuating price of oil will worsen the inflation crisis.
The concern over inflation was voiced at the two-day Finance and Central Bank Deputies’ Meeting (FCBDM) of APEC nations held last week, said Krisada Chinavicharana, permanent secretary of the Thai finance ministry, which hosted the meeting. Thailand holds the rotating chair of the APEC trade bloc this year.
During the meeting, participants expressed worry that the rising oil price would add more pressure to inflation and fiscal policies of APEC members’ governments.
Participants agreed to keep a close watch on oil price volatility to gauge how long it would impact inflation in their countries.
“The meeting discussed and expressed concern at the oil price, which was still fluctuating. The price rose just before the meeting started but then gradually dropped during the talks. We will monitor how long the impact will pressure inflation and fiscal policies,” Krisada said.
The meeting also discussed the global and regional economic situation and economic trends, added. The APEC Policy Support Unit (PSU) presented analysis of the regional economic trend and estimated that the global economy would grow by 4.4 per cent this year and 3.8 per cent next year.
The APEC PSU also forecast that the APEC economy would expand 4.2 per cent this year and 3.8 per cent next year. But the policy unit was concerned that the global economy could be affected by risks and instability of geopolitics and oil prices, Krisada said.
He said the Fiscal Policy Office (FPO) informed the meeting that the Thai economy would expand by four per cent this year despite the effect of the Covid-19 situation, rising oil price and geopolitical tensions.
The FPO told delegates the government was confident the economy is recovering well from Covid-19 thanks to supportive fiscal policies and revival of the tourism sector.