DOF projects 3.4% inflation for 2024

DOF projects 3.4% inflation for 2024
Photo by Juan Carlo de Vela
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THE Department of Finance (DOF) is projecting a full-year inflation rate of a 3.4 percent by the end of 2024.

Finance Secretary Ralph Recto, in a media briefing in Malacañang on Tuesday, September 24, 2024, expressed confidence that the country will meet the target inflation rate of the Bangko Sentral ng Pilipinas (BSP) for 2024 which is within 2.0 to 4.0 percent.

The country’s inflation settled to 6.0 percent in 2023.

From 4.4 percent inflation in July, it went down to 3.3 percent in August.

It is expected to further slow down to 2.5 percent in September, but is again forecasted to tick up from October to December but will remain within the target range of 2.0 to 4.0 percent.

“So, for the full year, we’re looking at the total inflation rate to be about 3.4 percent more or less. And the beauty about reducing inflation is that your GDP (gross domestic product) growth goes up and more jobs can be created, your borrowing cost goes down,” said Recto.

For 2025, Recto expressed optimism that inflation will further relax within 2.9 to 3.1 percent.

Recto also said they are in coordination with the BSP regarding interest rates on government borrowings, as well as the proposal to further reduce interest rates for personal loans.

“Possibly we can reduce interest rates further. Mas maliit ngayon iyong interest rate na babayaran ng gobyerno. Pero higit sa lahat, pababa na rin iyong interest rate – halimbawa sa credit card ni Juan Dela Cruz papunta sa Pasko,” Recto added.

(Possibly we can reduce interest rates further. The interest rate that the government pays is now lower. But more importantly, interest rates are also decreasing – for example, the interest rate on Juan Dela Cruz's credit card as we approach Christmas.)

The finance secretary is determined to help the country achieve an “A-“ score from all credit rating agencies by the end of President Ferdinand “Bongbong” Marcos Jr.'s term.

Recto said the government is continuously following its medium-term fiscal framework plan which aims to reduce the deficit by 3.8 percent by 2028.

Credit rating agencies have previously considered the plan, which allowed the country to receive an upgraded rating from Japan’s Rating and Investment Information, Inc. (R&I), as credible.

In August this year, R&I upgraded its rating on the Philippines to “A-“ with a stable outlook from last year’s “BBB+” with a positive outlook. (TPM/SunStar Philippines)

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