HEADLINE INFLATION likely settled between 3.3% to 4.1% in January on fuel, energy and food price hikes as well as higher excise taxes on consumer goods, the Bangko Sentral ng Pilipinas (BSP) said on Friday.
“Higher prices for fuel and meat as well as increased Meralco (Manila Electric Co.) power rates and excise taxes on alcoholic beverages and tobacco contributed to upward price pressures during the month,” BSP Governor Benjamin E. Diokno said in a Viber message to reporters on Friday.
Mr. Diokno said the central bank sees a point inflation of 3.7% for this month, closer to the upper end of its 2-4% target for the year. This would also be faster than the 3.5% print logged in December as well as the 2.9% seen in January 2020.
Prices of gasoline, diesel and kerosene went up by P2.15, P1.55, and P1.50 per liter, respectively, during the month, data from the Department of Energy showed.
Meanwhile, Meralco said earlier this month that the January electricity rate is up P0.2744 per kiloWatt-hour (kWh) compared to its December level. A typical household consuming 200 kWh is expected to pay an additional P55, while households consuming 300 kWh, 400 kWh, and 500 kWh will see bill increases of P82, P110 and P137, respectively.
Food prices have also been increasing due to the supply shock caused by the African Swine Fever, with pork prices hovering around P400 per kilo and a whole chicken costing P200, based on latest data from the Department of Agriculture.
On the other hand, Mr. Diokno said stable rice prices, lower prices of selected fish and vegetables, and the sustained appreciation of the peso could offset these cost increases.
Data from the Philippine Statistics Authority showed prices of well-milled rice slipped 0.2% week on week to P37.31 per kilo in the first week of January. Meanwhile, the retail price was flat at P40.89 per kilo.
The average wholesale price of regular-milled rice also inched down 0.2% to P33.33 per kilo while the retail price slipped 0.1% to P36.15.
Meanwhile, the peso has been hovering around the P48-per-dollar level this month.
“Going forward, the BSP will remain watchful of economic and financial developments to ensure the delivery of its primary mandate of price stability conducive to a balanced and sustainable economic growth,” Mr. Diokno said.
BSP Deputy Governor Francisco G. Dakila said last week that inflation is likely to stay within its 2-4% target until 2022, even with the recent uptick in global oil and good prices due to supply disruptions.
The BSP sees headline inflation averaging 3.2% this year, higher than the actual 2.6% recorded in 2020. — L.W.T. Noble