Despite the disruption brought by the monsoon rains last week, inflation is seen falling within the government’s 3-5 percent target, an official of the National Economic and Development Authority (NEDA) said.
NEDA Deputy Director-General Emmanuel Esguerra said the immediate impact of the recent weather disturbance would be on the supply and prices of goods.
“I suppose it’s really going to come from the supply disruption. I think you will see the initial impact on prices,” Esguerra said in an interview.
Already, inflation rose to 3.2 percent in July, the fastest since the 4.0 percent reported in January. In Metro Manila, inflation jumped to 3.1 percent in July from 2.2 percent in June.
The National Statistics Office also reported that the food index in the country inched up to 2.2 percent in July from 2.0 percent in June. In NCR [National Capital Region], the food index climbed 1.7 percent in July from 0.8 percent in June.
“But even with that 3.2 percent, we are still comfortably within the 3-5 percent,” Esguerra said.
He also noted that the average inflation from January to July at 3.1 percent was well within the government target.
Esguerra added that the agency was still evaluating the impact of the recent calamity on the country’s economic growth.
He, however, said that apart from the disruption in the supply of some goods, another impact of the calamity could be productivity losses due to work stoppage.
Work in government offices and private companies in flood-affected areas, as well as trading at the Philippine Stock Exchange, were suspended on Tuesday last week.
“Where you had the brownouts, you have loss output,” he said.
The Philippines grew 6.4 percent in the first quarter. The government is aiming for a GDP growth of 5 to 6 percent for 2012.