THE Philippine government needs to do more to bring down the cost of fuel, electricity, food and other basic necessities if it wants to stimulate consumer spending as the holiday season approaches, business leader Sergio R. Ortiz-Luis, Jr. said.
In a live audio interview with radio station True FM on Sept. 25, 2026, Ortiz-Luis, chairman emeritus at the Philippine Chamber of Commerce and Industry (PCCI), said the easing of headline inflation from 6.2 percent in July to 6.1 percent in August was too small to be felt meaningfully by consumers and businesses or to provide a significant boost to economic activity during the Christmas season.
The Philippine Statistics Authority (PSA) reported that headline inflation eased to 6.1 percent in August from 6.2 percent in July, but remained well above the government’s two percent to four percent target. Inflation was just 1.5 percent in August 2025.
Ortiz-Luis said the continued elevated cost of essential goods and services was limiting consumers’ purchasing power and could constrain holiday spending.
He agreed with analysts’ forecasts that inflation could continue to rise toward the end of the year if geopolitical tensions in the Middle East persist, potentially putting additional pressure on fuel and other prices.
Ortiz-Luis also questioned whether the recent increase in the minimum wage in Metro Manila would be sufficient to help workers cope with the higher cost of living.
He said proposals to legislate wage increases should take into account the ability of businesses, particularly micro and small enterprises, to absorb higher labor costs.
Ortiz-Luis said higher wage costs could put smaller businesses in a difficult position because raising prices could push products beyond consumers’ reach, while absorbing the additional costs could force some businesses to reduce their workforce or close.
He also warned that a combination of high inflation and rising labor costs could make the Philippines less attractive to foreign investors.
On the peso’s weakness against the US dollar, Ortiz-Luis said the impact would vary across sectors.
A weaker peso could benefit local agriculture by making imported fruits and other agricultural products relatively more expensive, potentially encouraging consumers to buy locally produced goods. It could also benefit exporters and the tourism sector by making Philippine goods and services relatively cheaper for foreign buyers and visitors.
Ortiz-Luis is also the president of the Philippine Exporters Confederation Inc.
On the other hand, he said a weaker peso would increase the peso cost of the government’s foreign-currency obligations and raise the costs for importers, who would have to pay more in pesos for goods purchased abroad.
To boost investor confidence, Ortiz-Luis urged the government to address geopolitical tensions involving the Philippines and move swiftly to resolve controversies surrounding the flood-control scandal and the ongoing impeachment proceedings. / PHILEXPORT NEWS
