Sept inflation rises to 6.1%, rice prices blamed
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PHL IN MEN’S BASKETBALL FINAL The Philippines—thanks to Justin Brownlee getting unstoppable all night long—edged China, 77-76, on Wednesday to advance to the men’s 5x5 basketball gold-medal play in Hangzhou. Gilas Pilipinas faces Jordan in the final on Friday. NONIE REYES
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IVEN the latest inflation print and risks that could further lead to price spikes for the country's food staple, there may be room to revisit its proposal to reduce rice tariffs, according to the National Economic and Development Authority (Neda). On Thursday, the Philippine Statistics Authority (PSA) reported that inflation rose to 6.1 percent in September on the back of a 17.9-percent increase in rice prices. While the average headline inflation rate was a four-month high, the spike in rice prices was the highest in 14 years. (Full story here: https://businessmirror.com.ph/2023/10/05/inflationposts-4-month-high-in-september/).
Socioeconomic Planning Secretary Arsenio M. Balisacan said in a statement that if global rice prices keep rising, the government must respond to stabilize commodity prices nationwide. As the country’s food staple, rice is heavily weighted in the country’s Consumer Price Index (CPI). “Should the global price of rice continue to rise due to the impacts of El Niño and rice export bans among key rice-exporting countries, resulting in a need for a more robust response to stabilize local prices, the proposal to temporarily lower tariffs on rice, regardless of origin, may be revisited,” Neda said in a statement Thursday.
At the last Inter-Agency Committee on Inflation and Market Outlook (IAC-IMO) meeting on October 3, the committee recommended extending the lower Most Favored Nation (MFN) tariff rate on rice under Executive Order (EO) No. 10. “To address the increasing price of rice and ensure enough supply through timely and adequate importation, the IAC-IMO recommends extending the lower MFN tariff rate on rice until December 2024, but subject to review in July 2024,” Balisacan said. “This policy response must be complemented by efforts to improve the predictability and transparency of issuing the San-
itary and Phytosanitary Import Clearance for rice and all commodities,” he added. However, Philippine Institute for Development Studies (PIDS) Senior Research Fellow Roehlano Briones said there may not be enough basis for reduced tariffs at this time given that rice prices are already on their way down due to the harvest season. “Tariff reductions can increase consumption but can negatively reduce production unless an effective and practical government production strategy is established,” Ateneo de Manila University economist Leonardo Lanzona told BusinessMirror. See “Sept,” A2
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Rice retail price could dip ₧3/kilo on ‘bumper’
By Cai U. Ordinario @caiordinario
ITH the increase in commodity prices reaching the high end of the Bangko Sentral ng Pilipinas (BSP) inflation expectations for September, analysts are now more certain that the Monetary Board will decide to raise key policy rates by November. Bank of the Philippine Islands (BPI) Chief Economist Emilio S. Neri said he expects a 25-basispoint (bps) increase in the Target Reverse Repurchase (RRP) Rate which was maintained at 6.25 percent last September. Neri also noted that a rate hike is imminent given the still high core inf lation rate. Philippine Statistics Authority (PSA) data showed that core inflation slowed 5.9 percent in September from the 6.1 percent in August, but remained higher than the 5 percent recorded in September last year. “A 25-bps hike in November is now more likely after the surprise print as risks of spillover to other goods and services have intensified,” Neri told BusinessMirror. “Bumabagal pagbaba ng core [but it] remains way above [the] 4-percent target for too long already.” In a statement, BPI said core inflation could increase again and second-round effects may form again. This is in view of the P1
By Jasper Emmanuel Y. Arcalas
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In the disputed South China Sea on August 22, 2023, a Philippine supply boat skillfully navigates around Chinese coast guard ships attempting to obstruct its path near Second Thomas Shoal, locally known as Ayungin Shoal. On Wednesday, October 4, 2023, two Philippine supply boats successfully breached a Chinese coast guard blockade in a recurring confrontation near the disputed shoal. This area has been guarded for years by a small contingent of Filipino marines stationed aboard the long-marooned but still actively commissioned warship, the BRP Sierra Madre. There are concerns that this situation could escalate into a larger security crisis, potentially involving the United States. AP/Aaron Favila
@jearcalas
HE retail price of rice could decline by as much as P3 per kilogram in the coming months as the country anticipates a “bumper” harvest, with pundits projecting a record-high grain output this year, an industry group said. Orly Manuntag, cofounder of Philippine Rice Industry Stakeholders Movement, said they expect retail prices of rice to fall by P2 to P3 per kilogram in the last quarter of the year as the country starts its main harvest of palay. The agriculture department is projecting a record-high milled rice output of 13.11 million metric tons (MMT) this year, surpassing the 2021 record of 13.054 MMT. In the second semester alone, the department projects that milled rice production would hit 7.2 MMT. See “Rice,” A2
WORLDREMIT: 1B PEOPLE DEPEND ON REMITTANCES By VG Cabuag
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@villygc
BOUT 1 billion people worldwide, or one in every eight persons, depend on remittances, according to the 2023 Global Cost of Living Index of global payments company WorldRemit Belgium. The study assesses how the cost of living crisis is affecting financial decisions, including those of remittance senders who regularly send money home to support their loved ones. Results show 73 percent of respondents in the United States, 70 percent in the United Kingdom and 78 percent in
Australia reported an increase in the daily cost of living. Some 81 percent of them said they felt utility costs increased in recent months. Housing costs continue to be impacted with 72 percent of respondents reporting an upswing in mortgage and rent payments, while 46 percent of respondents noted an increase in education and 74 percent in transportation. “A s inter nationa l money senders report rising living costs both for themselves and their families, they are increasingly making the tough decision between supporting themselves and supporting their loved ones
back home. Receivers rely on the hard-earned money delivered by remitters for vital things like day-to-day expenses [such as food, transportation and clothing], healthcare and educational support,” said Mark Lenhard, CEO of Zepz, the group powering global remittance brands WorldRemit and Sendwave. “Our data shows that as the cost of living crisis looms, many are making sacrifices in order to continue to provide that support to billions across the globe,” he said. This year’s cost of living index indicates remittances sent See “WorldRemit,” A2
See “Rate,” A2
PESO exchange rates n US 56.7490 n japan 0.3808 n UK 68.9046 n HK 7.2490 n CHINA 7.7600 n singapore 41.3834 n australia 35.8710 n EU 59.6375 n KOREA 0.0420 n SAUDI arabia 15.1310 Source: BSP (October 5, 2023)