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Apart from the ongoing pandemic, NEDA said the effects of typhoons and La Niña on the agricultural sector and food prices pose upside risks to inflation. (Photo from Department of Agriculture)

Inflation still within government target in October 2020

The country’s inflation continued to settle within target in October 2020, though upside risks such as the adverse impact of inclement weather and the lingering presence of the African Swine Fever (ASF) remain, the National Economic and Development Authority (NEDA) said. 

The Philippine Statistics Authority reported recently that the country’s headline inflation inched up to 2.5 percent in October from 2.3 percent in September 2020, bringing the year-to-date inflation to 2.5 percent. 

This is still within the central bank’s inflation target of 2 to 4 percent for the year. 

“Aside from the ongoing pandemic, the country has been facing adverse weather conditions in the recent months. Effects of typhoons and La Niña on the agriculture sector and food prices pose upside risks to inflation,” said Acting Socioeconomic Planning Secretary Karl Kendrick T. Chua. 

Latest projections from the Department of Agriculture (DA) show that the supply of key food products is likely to remain sufficient until the end of the year. However, agricultural damage may put food supply at risk, and thus put pressure on prices. 

“A key strategy for food security and food price stability during uncertain times is to prolong the shelf life of agricultural goods. This may come by way of introducing proper technology and increasing investments in warehouses and cold storage facilities in strategic locations,” the NEDA chief said. 

He also emphasized the need for the government and the private sector to tap local producers in nearby provinces or regions to make up for the lost harvest in disaster-stricken areas. 

“Relief efforts in heavily affected areas are being prioritized. NEDA, meanwhile, has been participating in post-disaster needs assessment led by the Office of Civil Defense. We will provide an analysis of the effects of the disasters on various sectors, including macroeconomic impact.” Chua added. 

Furthermore, Chua said that support to the agriculture sector is also needed due to the continued presence of ASF in the country, which has resulted in tighter supply and higher prices of pork in Luzon. 

“The government will strictly implement biosecurity measures and food safety protocols to curb the spread of animal diseases in farms and guarantee safe consumption of meat products,” he added.

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