John Matthew Cruz
The Department of Finance (DoF) said headline inflation likely accelerated to 3.6 percent in March on the back of a weaker peso that pushed up food, power and fuel prices.
According to the DoF’s latest Economic Bulletin released Tuesday, inflation rate was likely faster than the 3.3 percent in the previous month and 1.1 percent in the same period last year.
The DoF estimate is within the Bangko Sentral ng Pilipinas’ (BSP) 3 percent to 3.8 percent inflation forecast, and hits the upper end of the 3.1 percent to 3.6 percent estimates by seven analysts polled by The Manila Times.
The Philippine Statistics Authority is set to release the official March inflation report today, April 5.
In a statement, Finance Undersecretary and Chief Economist Gil Beltran cited the impact of “base effects,” saying global petroleum prices have started normalizing from low levels set last year.
“The BSP has lowered its inflation forecast for the whole year 2017 (to 3.4 percent from 3.5 percent) due to lower actual inflation than earlier forecast,” Beltran said.
Last month, prices of food and non-alcoholic drinks likely rose to 4.5 percent from 4.1 percent, while alcoholic drinks and tobacco jumped 6.5 percent from 6 percent, the bulletin showed.
Prices of housing, utilities and fuels are also expected to increase by 4.1 percent from 2.9 percent.
Clothing and footwear inflation is seen to reach 2.9 percent, up from 2.8 percent in February, while health may have settled at 2.8 percent from 2.6 percent.
Transport prices likely dropped to 1.9 percent from 2.8 percent, and restaurants and miscellaneous services to 1.8 percent from 2.1 percent.
Furnishings, households equipment (2.3 percent), recreation and culture (1.8 percent), education (1.8 percent) and communication (0.2 percent) are expected to remain steady.
Last month, the Manila Electric Co. (Meralco) raised its rates to P10 per kilowatt hour (kWh) for households consuming an average of 300 kWh per month from P9.3 in February and P8.9 percent a year earlier.
Meralco’s generation charge rose to P4.9 per kWh from P4.3 in the previous month and P4 last year.
The average price of diesel in Metro Manila slightly dropped to P31.1 per liter from P31.3 in the previous month, but higher than P22.5 in the same month in 2016, the DoF said, citing data from the “big three” oil companies.
The average price of gasoline also decreased to P46 per liter from P47.7 in February, but well above P37.6 in the same month last year.
BSP data showed the average peso-dollar exchange rate was P50.27:$1 in March, weaker than P49.96:$1 in February and P46.72:$1 a year earlier.