(PNA file photo)
ANTIPOLO CITY – Both economists and retailers welcomed the easing of price pressures in the country even as they pointed out the presence of factors that could trigger another inflationary uptick.
This came in reaction to Wednesday’s release by the Philippine Statistics Authority of its report showing that the country's headline inflation had slowed down to 5.4 percent in June, which also represented five continuous months of decline.
It can be recalled that inflation in May was still slightly higher at 6.1 percent, but figures registered in the year’s second quarter remained far behind peak inflation in January, which was at a high of 8.7 percent.
In an interview, Alvin Ang, chairman of Ateneo de Manila’s economics department, forecast that inflation will continue to decline in the coming months as supply issues in certain food items continue to be addressed.
He, however, noted that core inflation remains higher, which is an indicator that non-food items remained expensive.
“Inflation continues to fall due to easing supply pressures for food and oil. This will be the pattern till the end of the year unless another major shortage in food or sudden increase in oil appears. Note, however, that non-food item prices continue to increase which can lead to more wage pressures,” said Ang.
The economist was referring to continued calls by some legislators and labor groups for an additional wage hike on top of the PHP40 per day increase approved by the Regional Tripartite Wages and Productivity Board for National Capital Region workers last week.
Meanwhile, Steven Cua, president of the Philippine Amalgamated Supermarkets Association (PAGASA), told the Philippine News Agency (PNA) that food manufacturers have not yet given retailers any indication that they intend to increase the prices of their products.
However, he said it is not unlikely that suppliers will raise prices of various food commodities when the latest wage hike takes effect on July 16.
Cua said that some PAGASA members and others in the retail sector may also be forced to raise prices to unburden themselves of the added cost brought about by the latest wage hike.
“Each retailer will have their own means of dealing with it (wage hike), but we are all conscious of how increasing prices (of food) can be detrimental (to business),” he said. (PNA)
