Supply side continues to drive inflation, says BSP

October inflation did venture into the upper range the Bangko Sentral ng Pilipinas had earlier forecast, with the index rising by 5.3 percent on increases in the cost of fuel and electricity and the hikes in prices of fish, fruits and vegetables, the BSP and National Statistics Office (NSO) said in separate statements on Friday. “Dominant drivers of inflation continue to come from the supply side, which are generally temporary shocks that may be directly addressed by non-monetary intervention measures," according to BSP Governor Amando Tetangco, Jr. The BSP issued the more detailed report and determined that prices of fruits and vegetables in October were 17.11 percent higher than the year-ago level and fish costing 8.37 percent more last month than in October 2010. Comparing October’s prices to those of September’s, fruits and vegetables were more costly by 7.85 percent and fish prices increased by 1.08 percent. The BSP noted double-digit increases in the utilities components of the consumer price index. Fuel jumped by 14.04 percent, light by 13.55 percent and water by 9.92 percent. Also observed was a 9.5 percent increase in transport costs. According to the NSO, the price increases in food, beverages and tobacco from September to October, in the National Capital Region rose by 1.7 percent, versus the 1 percent in areas outside NCR. — With Earl Victor Rosero/VS, GMA News