Holiday Season pushes inflation up in December 2016

  • January 12, 2017

 

MANILA, Jan. 12 – Inflation in December 2016 slightly rose to 2.6 percent from 2.5 percent in the previous month, bringing full-year 2016 inflation to 1.8 percent, according to the National Economic and Development Authority (NEDA).

“The uptick in inflation last month was caused by price increases partly due to the holiday season and supply constraints on some food items,” said Socioeconomic Planning Secretary Ernesto M. Pernia.

The full-year 2016 inflation of 1.8 percent is below the government’s target range of 2.0 to 4.0 percent for the year, but higher than the 1.4 percent of 2015.

Food inflation for December 2016 increased to 3.7 percent from 3.5 percent in the previous month, and higher than the 1.8 percent in the same period in 2015. Faster increases in the prices of bread and cereals (1.6% from 1.5%), fish (5.5% from 4.7%), and meat (1.8% from 1.5%) were recorded.

Non-food inflation for December was pushed by transport (1.9% from 0.5% in November) and recreation and culture (1.7% from 1.6% in November). The faster spike in transport costs can be traced to the considerable increases in domestic petrol prices such as unleaded gasoline (10.0% from 3.98%) and diesel (16.04% from 7.41%).

“The higher prices in transport commodity reflected the hike in international oil prices caused by oil-producing countries’ decision to cut oil production by almost 1.8 million barrels per day,” said Pernia.

Core inflation, which excludes selected volatile food and energy prices, also inched up to 2.5 percent in December 2015 from 2.4 percent in the previous month. The 2016 full year core inflation averaged at 1.9 percent, still lower than the 2.0 percent recorded in 2015.

“This indicates slower price movements across a relatively wide range of commodity items,” the Cabinet official said.

For 2017 and 2018, the government expects inflation to be within the target range of 2.0 to 4.0 percent. This already considers the scenario of higher oil prices, pending petitions for adjustments in electricity rates, but especially, strong domestic economic activity.

“The inflation outlook is supported by the country’s brisk domestic demand conditions, buoyed by solid private household spending, higher government expenditure, and adequate domestic liquidity,” said Pernia.

Pernia also noted that the damage to rice resulting from typhoons Karen, Lawin, and Nina could lead to faster inflation in early 2017. Rice comprises a sizeable portion of the Consumer Price Index basket.

“The volatility in rice prices could affect the overall welfare of the Filipino families, particularly the poor who spend around 20 percent of their incomes on rice. Therefore, the government needs to promote more resilient practices for rice production to minimize the impacts of climate-related shocks,” he said. (NEDA)


Other News

PIA to launch ASEAN Information Kiosk inside Clark International Airport
  • March 27, 2017
CLARK FREEPORT ZONE, March 27 (PIA) -- Philippine Information Agency (PIA) is set to launch on March 28 its ASEAN Information Kiosk inside Clark International Airport.   “This seeks to provide useful information on the Association of Southeast Asian Nations (ASEAN), the Philippines, Central Luzon, Pampanga, and government services to Overseas Filipino Workers, and local and foreign tourists. This is part of hyping Clark’s hosting of the centerpiece 31st ASEAN Summit and related meetings come November 2017,” PIA Regional Director William Beltran said.          “The ...Read more
KumpaS: Listening to the Filipino, One Barangay at a Time
  • March 26, 2017
The President’s communication group intends to hear out concerns and hold discussions on key national issues with a new grassroots campaign led by Secretary Martin Andanar In Manila, an article noting that there’s a dangerous heat wave was circulating all over the net. It was 41 degrees the day before and the warmth can be felt across the Metropolis. The weather was as unforgiving in Bacolod City that Friday afternoon. The heat was searing, but there were people working overtime at the covered court of Jose Torres Elementary School where an event is about to take place in a few hours. ...Read more
President Duterte breaks ground for drug rehab center in Bukidnon
  • March 26, 2017
MALAYBALAY CITY, BUKIDNON – President Rodrigo Duterte on Saturday, March 25, led the groundbreaking of the Drug Abuse Treatment and Rehabilitation Center (DARTC) here in Bukidnon. With a capacity of around 500-800 patients, the P 700-million drug rehabilitation center will soon rise in a five-hectare land in Malaybalay City, Bukidnon, which was donated to its city government. In his speech during the groundbreaking ceremony of DARTC, President Duterte encouraged the illegal drug dependents to surrender because they "cannot discern what is right and what is wrong" when they are into suc...Read more
CSC issues clarificatory rule on state workers with dual citizenship
  • March 26, 2017
QUEZON CITY, March 26 -- The Civil Service Commission (CSC) announced that incumbent government employees who have dual citizenship had until last Thursday, 23 March 2017, to renounce their foreign citizenship.   CSC Chairperson Alicia dela Rosa-Bala said that, per CSC Memorandum Circular (MC) No. 23, s. 2016 issued on 15 September 2016, failure to meet the deadline for renouncing foreign citizenship by employees covered by the said policy would result in the recall of the prior approval/validation of their appointments.   Recently, the Commission issued a clarification thru MC ...Read more