MANILA - The series of strong storms that hit the Philippines in October and November will likely accelerate this month’s inflation, and affect even prices in December, an analyst said on Monday.
Unionbank chief economist Carlo Asuncion said he expects November inflation to accelerate to 3 percent from October’s 2.5 percent, saying they noticed upticks in prices immediately after the storms.
He added that the damage to agriculture caused by the storms can spill over to prices of basic commodities up to the end of the year.
“It’s a quintet of storms, so you would imagine that this may actually carry over to even December,” Asuncion said in an interview with ANC.
Asuncion added that the Bangko Sentral ng Pilipinas is also likely to pause on further interest rate cuts until February next year when fresh data on the economy comes out.
He said there was enough liquidity in the economy and that the BSP’s unexpected rate cut this month was due to worse-than-expected contraction of the economy in July to October period.
The BSP made a surprise rate cut of 25 basis points this month after the country’s gross domestic product shrank 11.5 percent in the third quarter, which was worse than the 9.8 percent contraction forecast by some analysts.
Meanwhile, Asuncion said he isn’t expecting any big improvements in the jobs data either. The employment landscape won’t be going back to pre-pandemic levels until at least 2022, he said.
The government is set to announce both Inflation and jobs data this Friday.