MANILA, Philippines — President Rodrigo Duterte on Friday said rising oil prices are the “number one culprit" in the Philippines’ multi-year high inflation, which is now higher than most emerging economies in Asia.
“What's driving inflation now? Simply it's the prices of oil,” Duterte said in a speech.
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“It's not an excuse. I admit there is an inflation. But it’s really --- the number one culprit is price of oil,” he added.
Inflation jumped 6.4 percent in August, the highest level in almost a decade, as global oil and rice prices picked up. Higher excise taxes slapped on fuel and other goods also pushed up commodity prices.
Data from the energy department show most oil companies implemented a per liter price increase of P0.50 for gasoline, P0.20 for kerosene and P0.15 for diesel last September 18. Year-to-date, local pump prices have increased by P9.00/liter for gasoline and P9.15/liter for diesel.
source: tradingeconomics.com
The Bangko Sentral ng Pilipinas has raised its policy rates by a cumulative 100 basis points from May to August in a bid to fight inflation. The central bank also vowed to undertake “strong monetary action” in the upcoming rate-setting meeting on September 27.
Facing public backlash, Duterte — who rarely talks about the economy — earlier blamed the country’s spiralling inflation on US President Donald Trump’s protectionist trade policies and interest rate hikes by the US Federal Reserve, contradicting the BSP’s view and government data.
FACT CHECK: Is Trump to blame for spiraling Philippine inflation?
British banking giant HSBC has said the BSP will remain under pressure next year, as the second tranche of excise tax increases under the Duterte administration's tax reform law takes effect in January.
READ: HSBC: Rate hikes alone won't fully address inflation