INFLATION ....

2024 due largely to negative base effects and some easing of supply constraints affecting key commodities," the BSP said.

It noted however that inflation may exceed the target range in the second quarter of the year due to the impacts of El Niño weather conditions and positive base effects.

The BSP said the balance of risks to the inflation outlook continues to lean significantly towards the upside.

"Key upside risks are associated with potential pressures emanating from higher transport charges, increased electricity rates, higher oil prices, and higher food prices due to strong El Niño conditions," it said.

The central bank added that the impact of a relatively weak global recovery and the government measures to mitigate the effects of El Niño could ease some price pressures.

"Looking ahead, the Monetary Board deems it necessary to keep monetary policy settings sufficiently tight until a sustained downtrend in inflation becomes evident. The BSP will consider the latest inflation and GDP (gross domestic product) outturns for the Monetary Board’s policy meeting on 15 February 2024," it said.

Government intervention

Meanwhile, the National Economic and Development (NEDA) said the government is continuously monitoring food supply and prices in anticipation of the El Niño phenomenon.

NEDA Secretary Arsenio Balisacan said the Inter-Agency Committee on Inflation and Market Outlook (IAC-IMO) is closely monitoring the prices of rice and other goods to provide the President and the Cabinet with timely and appropriate policy recommendations and ensure stable and affordable prices of commodities.

"We introduce stop-gap measures, as necessary, such as allowing further imports on key commodities until our supply stabilizes at prices affordable to consumers while ensuring remunerative prices for local producers," Balisacan said in a statement.

To ensure stable prices of goods, President Ferdinand R. Marcos Jr. earlier issued Executive Order (EO) No. 50, which extends the reduced tariff rates of pork, corn, and rice until the end of the year.

He also issued EO No. 53 which reactivated the Task Force El Niño, to intensify the government's efforts to secure sufficient water and food supply, power, health, and public safety nationwide.

The President also directed government agencies to implement the National Adaptation Plan 2023-2050 to increase communities' resilience against extreme weather disturbances.

Balisacan said the Department of Agriculture will continuously monitor on-the-ground situations and adequately guide the government in addressing food production concerns.

The Department of Social Welfare and Development will also expand its National Food Stamp program to cover 300,000 households in 2024.

Balisacan said this measure will help the government assist the most vulnerable families during the El Niño season.