Bangko Sentral ng Philipinas Governor Benjamin Diokno. INQUIRER FILE PHOTO/
EDWIN BACASMAS
The rate of increase in prices of basic goods and services in December is expected to fall between 3.5 and 4.3 percent, likely to be buoyed by bad weather at home but tempered by weaker factors abroad, according to the Bangko Sentral ng Pilipinas (BSP).
“Higher electricity rates along with the uptick in food prices due to weather disturbances are the primary sources of inflationary pressures during the month,” BSP Governor Benjamin Diokno said in a statement.
“These could be offset in part by rollbacks in domestic petroleum prices and the appreciation of the peso,” Diokno added.
The Philippine Statistics Authority pegged inflation in November at 4.2 percent, which brought the average for January to November at 4.7 percent. The 11-month figure was still above the government’s target range of 3 percent to 4 percent.
Over the past four weeks, local oil companies lowered pump prices twice and also increased twice, for a net decrease of P1.40 per liter of diesel, 45 centavos per liter of gasoline and P1.65 per liter of kerosene.
The peso was trading at 50.269 against the US dollar as of Dec. 29 after starting the month at 50.384.
According to the operator of the Wholesale Electricity Spot Market, damage wrought on power facilities in the Visayas by Typhoon “Odette” is expected to tighten supply and raise electricity rates in Luzon.
Meanwhile, the Department of Agriculture said at least P8 billion worth of crops and livestock was lost to Odette.
In a research note, Security Bank Corp. economist Robert Dan Roces estimated inflation to have slowed down to 4 percent in December from 4.2 percent in November.
“Our forecast range is 3.8 percent to 4.2 percent and the estimated month-on-month change is [a rise of] 0.7 percent,” Roces said.
The data scientist said food items in the group of commodities used to measure inflation may have contributed around 1.3 percent to December inflation.