DOF sees August inflation hitting 5.9%

By Joann Villanueva

September 3, 2018, 5:13 pm

MANILA -- A ranking official of the Department of Finance (DOF) forecasts August 2018 inflation climbing even higher to 5.9 percent but also noted that inflationary pressures appear to be easing.

This forecast exceeds the multiyear high of 5.7 percent posted last July. Inflation in September 2017 was far lower at 2.6 percent.

In an economic bulletin, Finance Undersecretary Gil Beltran said change in the monthly inflation decelerated to 0.38 percent in August from 0.51 percent last July and 0.60 percent last June.

“The driver of inflation is largely supply-side challenges which need to be addressed by improving productivity. In the immediate to medium-term horizon, the country needs to enhance food security by taking advantage of international trade,” he said.

Beltran also reiterated the economic managers’ push for rice tariffication, citing the big share of rice in the consumer price index (CPI) basket at 9.6 percent.

Recently, President Rodrigo R. Duterte certified as urgent the rice tarrification bill in a bid to help address the increase of inflation rate, which was mainly due to supply-side factors.

Also, Finance Secretary Carlos Dominguez III has said that liberalizing rice importation will be a big help to the poor, noting that rice accounts for 20 percent of low-income households’ consumption.

Big jumps in the prices of rice, a staple Filipino food, has been attributed as among the major driver of inflation.

Monetary officials project inflation to peak in the third quarter this year and return to the target level band of two to four percent in 2019. (PNA)