THE inflation rate for March, announced at 4 percent, is still cause for government action to provide immediate relief to poorest households despite being within target range.
At the same time, House Committee on Ways and Means Chairman Joey Sarte Salceda warned the government of the next pressure point for inflation possibly next month—wheat prices that were greatly impacted by Russia’s invasion of Ukraine, top wheat producer.
Referring to the March inflation print, Salceda said,“It’s at the cusp of breaking the target range, so it should definitely be treated as a trigger for more government action to provide relief.”
The economist-lawmaker said that the government should thus “expedite promised relief, including the targeted cash subsidies announced by President Duterte.”
“I also anticipate second-round effects to set in in other commodities, although as oil prices have begun to stabilize, I am cautiously hopeful that inflation will not be significantly worse over the coming months,” Salceda added.
“The Ukraine situation will last for months, and oil will not reach the levels we had gotten used to early in the pandemic. I still expect oil to settle above $80 this year, on average. Those are the levels considered ‘red flags’ under TRAIN. So assistance is still needed by the poorest of the poor,” he said. TRAIN is the Tax Reform for Acceleration and Inclusion Law.
Salceda, meanwhile, asked the government to watch out for wheat prices.
Salceda cautioned the government “that the next commodity increases may come from baked goods, as wheat shortages are expected in May due to the Russia-Ukraine conflict.”
“We should still see to it that we have adequate buffers of wheat, as that will be the next commodity that will see significant price increases due to this global situation.”
“I am talking with some departments on the matter. I think the Department of Science and Technology is promoting wheat substitutes,” he said.
Salceda also strongly recommended fortifying the bread with other vitamins and minerals, “so that, at least, if the ordinary consumer buys more expensive bread, they are also getting more by way of nutrition.”
“The next administration will inherit this situation, I have no doubt. So, food prices should always be part of the national conversation this election season,” he said.