Malacañang on Wednesday said the drop in the November rate of inflation was a result of President Rodrigo Duterte’s “decisive actions” to cushion the impact of high commodity prices.
The Palace reaction came after the Philippine Statistics Authority (PSA) reported that the country’s year-on-year inflation rate has eased to 6 percent in November from the previous 6.7 percent in September and October.
“The Palace accepts this as good news. We attribute this to the President’s empathy to public clamor and his decisive action,” said Presidential Spokesman Salvador Panelo in a statement.
He cited Duterte’s move to streamline procedures on the importation of agricultural products, including rice, as a way to stabilize prices of food items.
“These measures address issues on food supply, among others, as there is a marked decrease in food inflation from 9.4 percent in October to 8 percent in November. Prices of rice, corn, fish, meat, fruits, and vegetables have gone down,” he added.
This was the first time that the inflation rate slowed down this year.
Panelo said the Palace would continue to monitor the prices of basic goods and commodities.
According to the PSA, lower prices of food and non-alcoholic beverages, housing, water, electricity, gas, and other fuels, as well as communication, were recorded in November.
Speaker Gloria Macapagal Arroyo on Wednesday welcomed the drop in the inflation rate.
“I guess the moral of the story is, when there is a supply-side inflation, then we increase the supply. But we should do it as soon as we detect the supply side inflation,” Arroyo said.
This developed as Nueva Ecija Rep. Estrellita Suansing, the chairperson of the House Committee on Ways and Means, called on the country’s economic managers to withdraw their recommendation to President Duterte to implement an additional P2 per liter increase in the fuel excise tax next year.
Suansing said the increase next year should be suspended as originally proposed as a way to keep inflation in check.
The Associated Labor Unions-Trade Union Congress of the Philippines said prices of food, other commodities and services remain high despite the drop in the November inflation rate.
“This serious disparity tells us that the economic managers are just confined in doing table studies inside the elegant and air conditioned government boardrooms and not validating their survey with the realities experienced by ordinary people, said ALU-TUCP spokeman Alan Tanjusay.
The labor group urged government officials from the Department of Finance, Department of Budget and Management, Department of Trade and Industry and NEDA to form a team to double-check the prices of goods and take note of consumer complaints.
“Because of this arrogance, the ordinary people to whom these government officials are supposed to serve are being victimized by profiteering and rent-seeking businessmen, Tanjusay said.
Bangko Sentral ng Pilipinas Governor Nestor A. Espenilla Jr. hailed the deceleration of November 2018 inflation to 6 percent, calling it “very encouraging.”
“For the first time we are seeing significant negative month-on-month growth after inflation plateaued at around 6.7 percent. It confirms that inflation is heading back to the 2-4 percent target range in response to decisive non-monetary measures to curb food prices as well as favorable recent developments in highly volatile international oil prices,” he said.
The Central Bank chief was referring to the measures, such a the Palace’directive for the National Food Authority to release all its rice stocks nationwide starting last September as well as the move to import more rice.
These non-monetary actions were made alongside the hikes in the BSP’s key rates, which to date totaled to 175 basis points.
Espenilla said “strong monetary action has significantly reinforced the anti-inflation process through the expectations route and a firmer peso.”
The November rate brought the 11-month inflation average to 5.2 percent, way above the government’s 2 percent to 4 percent target.
Authorities expect inflation to go back to within-target levels next year. With PNA
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