Saturday, December 06, 2008 Government welcomes inflation cut
MALACAÑANG on Friday welcomed the reduction of the inflation rate for November to single digit, but said it is still expecting the worst in view of the global economic crisis.
Presidential Management Staff director general Cerge Remonde said the 9.9 percent inflation rate for November, which is lower than October's 11.2 percent, proves that President Gloria Macapagal-Arroyo is “managing the economy well.”
Remonde's agency oversees the infrastructure programs of the government that pump prime the economy.
Government reported that inflation fell to single-digit, the first time in six months, as prices of rice, fuel and food declined. The 9.9 percent inflation for November was lower than the Bangko Sentral's estimate of 10.3 to 11.2 percent.
From the January to November period, inflation was at 9.4 percent, which is within government's target of nine to 11 percent.
Remonde said Malacañang is “very grateful” for the reduction in the inflation rate because it proves that the President’s “has managed the economy well despite the unpopularity of her fiscal reforms.”
He said the Philippine economy's strength has been confirmed time and again by international credit rating agencies that have considered the Philippines as “an island of calm in the sea of turmoil.”
On the possible effect of the global financial crisis which has placed the US and some European countries under a recession, Remonde said: “We hope for the best but expect the worse. That's why we don’t like politics. We want to focus on the economy.”
Deputy presidential spokeswoman Lorelei Fajardo said in a text message that government expects the trend of lower inflation to continue although there are many “complex forces at work here and we are studying how we can balance those forces” to sustain the growth of the domestic economy.
Fajardo said Planning Secretary Ralph Recto expects prices to go down this month until next year. She said the Palace is confident it would reach its target economic growth and that there is a better chance for this to happen when inflation goes down.
She said the lower inflation would enable the Bangko Sentral to have more flexibility in reducing interest rates that would lower finance costs for both investors and consumers. (JMR/Sunnex)
