Metro Manila (CNN Philippines, January 3) — Prices of basic goods likely rose by 2 percent in December, a CNN Philippines poll showed, enough to keep the full-year pace within target.
A poll among seven economists showed faster inflation last month, following a 1.3 percent climb in November. The figure also falls within the 1.8-2.6 percent forecast range of the Bangko Sentral ng Pilipinas.
If realized, the December forecast would be the quickest rise since June but will remain slower compared to a 5.1 percent increase in prices a year ago.
A 2 percent inflation rate in December would bring the 2019 average to 2.5 percent, well within the 2-4 percent target band of the central bank.
A seasonal uptick in demand for food items as well as alcoholic drinks may have pushed prices up, Security Bank economist Robert Dan Roces said. Higher electricity rates and increases in fuel and LPG prices also put pressure on costs, he added.
Despite this, rice prices — which saw big markups the previous year — are expected to drop further to sustain a trend seen the past few months.
“Prices of some food items also seasonal went up due to the Christmas holiday season, when demand usually picks up but to seasonally go down thereafter, especially ham, other alternative meat products such as chicken, beef, and fish,” Rizal Commercial Banking Corporation economist Michael Ricafort added.
National Statistician Dennis Mapa earlier said that pork prices have slumped while other meats saw costs rise given the African Swine Fever scare. The Philippine Statistics Authority will release official data on January 7.
Some economists said they expect the BSP to keep interest rates steady in their first policy-setting meeting next month, with Union Bank of the Philippines’ Carlo Asuncion citing the “higher-than-expected” rise in prices.
Alvin Ang, professor at the Ateneo Center for Economic Research and Development, said prices are likely to rise faster for the rest of 2020 with easing base effects.
