Marcos confident inflation rate to go down amid drop in prices of fuel, agriculture products

PRESIDENT Ferdinand “Bongbong” Marcos Jr. maintained confidence that the inflation rate will go down with the drop in the prices of fuel and its byproducts and imported agriculture products.

The Chief Executive issued the statement after the country’s inflation rate for last January rose to 8.7 percent, a 14-year high.

It was the fastest recorded surge since November 2008, dislodging the 8.1 percent registered in December 2022.

“As I said, the importation of many of the agricultural products, which have been a large part of the (increase in) inflation rate… we have already taken some measures so that the supply will be greater and so that will bring the prices down but that will take a little time,” Marcos said in a video statement Tuesday.

“And my continuing estimate or forecast is that by – we can see the lowering of inflation by the second quarter of this year,” he added, while further pointing out that steps taken by his administration to address the issue “have not yet gone through the system.”

Citing the International Monetary Fund’s (IMF) January 2023 World Economic Outlook Update, Marcos said high inflation is a global problem that will continue to be a challenge to all countries, but that he remains optimistic that “this is going to be as high as it’s going to get” and vowed for the results of the government’s interventions to be felt “down the road”.

The Philippine Statistics Authority (PSA) had said that the high inflation rate was mainly driven by increases in housing rentals, electricity and water rates, as well as in the prices of vegetables, milk, eggs, fruits and nuts.

The National Economic and Development Authority (NEDA), meanwhile, noted that the government’s economic cluster has identified measures meant to keep food price movements consistent with its inflation and food security objectives, with higher agricultural productivity, food supply augmentation, and energy security seen as priorities to temper upward price pressures.

These short-term measures include augmenting supply such as the temporary easing of import restrictions, price monitoring, and targeted social support, while medium- to long-term priorities include ensuring food security through higher agricultural productivity and ensuring energy security by pursuing the energy transition and development program.