Price surges end — BSP

Consumers rejoice Government announced yesterday the end of the uptick in prices of basic goods and services while strong economic growth continues. YUMMIE DINGDING">Consumers rejoice Government announced yesterday the end of the uptick in prices of basic goods and services while strong economic growth continues. YUMMIE DINGDING

The downtrend in prices of basic commodities and services was confirmed yesterday through a moderation of the inflation rate to an average of 5.2 percent for last year based on Bangko Sentral ng Pilipinas (BSP) figures released yesterday.

The BSP’s latest quarterly report showed inflation rate also eased to 5.9 percent in the last quarter from a 6.2 percent average in the previous three months.

The full-year average inflation rate was above the government’s target range of 3 percent for the year.

Food inflation moderated during the fourth quarter as supply conditions improved for key food items.

Core inflation rose to 4.9 percent higher than the rates posted in the previous quarter and a year ago.

Similarly, the Central Bank’s three alternative measures for core inflation were higher during the quarter, the BSP added in its report.

Non-food inflation eased in the final quarter of last year as lower international oil prices exerted downward pressure on transport inflation through lower gasoline and diesel prices.

Domestic demand indicators point to less robust market sentiment, the BSP report said.

Real gross domestic product expanded by 6.1 percent in the third quarter, slower than the 6.2-percent expansion in the second quarter and the 7.2 percent growth recorded in the third quarter.

High-frequency indicators of domestic activity continued to present mixed signals as the composite PMI stayed firmly above the 50-point expansion threshold, pointing to sustained expansion across all sectors.

Capacity utilization for the manufacturing sector showed that more than half of major manufacturing sectors operate at above 80 percent while energy sales accelerated. However, vehicle sales contracted, business outlook turned less optimistic and consumer confidence weakened during the quarter.

The easing of inflation rate will continue when the implementation of rice tariffication measure starts along with other government mitigating efforts, Sen. Sonny Angara said.

Angara added while the rate was still quite high, he is hopeful that the downtrend will continue.

The senator also cited efforts by the government to mitigate the inflation and protect consumers from profiteers.

“It’s still quite high, but thankfully lower than previous months and hopefully will go even lower with full effect of rice tariffication measure and other efforts to ensure against overpricing and profiteering,” Angara said.

The high inflation rate last year was largely blamed on the shortage in rice supply in the country – prompting the approval of Congress of the rice tariffication measure.