An undisturbed supply chain is key to ensuring that the pace of price rises can begin to ease in the near term, the Department of Finance said.
Finance Under-Secretary and Chief Economist Gil Beltran noted in an economic newsletter released on Saturday. He said that headline inflation softened to a five-month low of 2.2 percent year-on-year in April. It was mostly due to non-food products as an undisturbed supply chain. And then, it was more than offset the acceleration in food prices.
“The average price of non-food products decelerated to 0.7 per cent year-on-year as the downturn in global oil prices fell domestic fuel prices and hence transportation costs,” Beltran noted.
“Average food prices, however, increased from 2.6 per cent year-on-year in March to 3.4 per cent in April, mainly due to higher vegetable prices (10.3 per cent) and month-on – month rice price rises (1.4 per cent),” Beltran said.
The faster rise in food prices was blamed for disruptions in the supply chain. It took place in the enhanced community quarantine (ECQ) placed in Luzon.
In addition, other parts of the world has affected since mid-March to contain coronavirus spread.
The Average Price of Rise has Dropped
“Since November 2018 , the average price of rice has dropped. For instance, the month-to-month price change was negative until March. It came before the positive report on month-to-month price change in April,” Beltran continued.
Beltran expects inflation to further ease in the coming months. But, the supply chain of basic goods and other necessary items is important. Even though the subject to public health requirements, it should not be disrupted during this period of ECQ.
Last week, Acting Socio-economic Planning Secretary, Karl Kendrick Chua said this case. “During the COVID-19 lockdown, we had some essential cases.
For instance, food supplies or other vital commodities could not move through as the local governments enforce tighter quarantine or checkpoints.”
Chua, head of the National Economic and Development Authority’s state planning department, gave its response. “We also need to ensure that the supply chain is not disrupted. Therefore, we can maintain this low and steady rate of inflation.”
