Socio-economic Planning Sec. Cayetano Paderanga has expressed confidence that the expansion of the Philippine economy in the first half of the year will not trigger a significant rise in inflation.
“This is because commodity prices are kept low by the sufficient supply of food, and remittances from overseas Filipinos continue to support a stable peso,” Paderanga pointed out.
Sec. Paderanga noted that prices of wheat in the world market increased by as much as 25 percent over the previous month as Russia halted its export of the commodity over inadequate supplies due to drought and wildfire.
“This placed pressure on substitutes, such as rice, to increase in price. In the international market, Thai rice rose by 4.1 percent from July 2010,” he said, adding that with this development, “it is imperative that the government remains vigilant in ensuring ample local supplies and to mitigate any possible transmission effects of international prices on domestic prices.”
The annual price adjustment rates within Metro Manila rose to 4.5 percent in August, while those outside the capital was at 3.8 percent.
Year–to–date inflation stood at 4.2 percent, still within the Development Budget Coordination Committee target of 3.5 to 5.5 percent, Paderanga said.
He added that movements of consumer prices remain stable, after the National Statistics Office (NSO) reported a 4 percent increase in headline inflation in August from 3.9 percent posted in June and July.