pus26 @ dakintogel Experts: Costly rice still an inflation risk

JUST when expectations began to emerge that inflation is already on a downtrend, a US-based think tank warned that expensive rice may again become a culprit for the faster increase in commodity prices.

In an economic brief, Global Source Partners Country Analyst Diwa Guinigundo said this could make 2025 “problematic” and, as such, means monetary policy will be insufficient to address rising commodity prices.

Guinigundo noted that the Bangko Sentral ng Pilipinas (BSP) adjusted its inflation forecasts for the year to 3.4 percent this year and 3.7 percent in 2026 on the back of expectations that higher domestic food prices could not be ignored.

“With the BSP’s risk-adjusted inflation forecasts, we have an idea that the BSP itself realizes that risks could not be dismissed,” Guinigundo said.

“With these risks, the Government ought to do something that works rather than the usual stuff.”

Guinigundo said they deemed concerning the earlier disclosure by the Department of Agriculture (DA) that it was “contemplating on declaring a ‘food emergency’” in 2025 to help contain rice prices.

This was amid the alleged presence of rice cartels and hoarders, which, Guinigundo said, remains a challenge for the government to address along with the President’s campaign promise to reduce rice prices to P20 per kilo.

“This announcement raises some serious questions about the ability of Government to ensure the sufficiency of rice supply in the market from production to harvest to marketing to retail,” Guinigundo said.