According to IDEA’s latest copy of Economic Monitor, a regular publication of the Institute for Development and Econometric Analysis, Inc. (IDEA), annual headline inflation in September climbed to 2.7 percent from the 2.1 percent recorded in August. This however, was lower than the 3.7 percent recorded in the same period last year. Meanwhile, core inflation also increased to 2.3 percent in September from the 1.9 percent recorded in August.
Per IDEA, the uptrend in inflation from September to August was attributed to increases in indices of four major commodity groups. These include food and non-alcoholic beverages, which rose from 1.8 to 2.5 percent; alcoholic beverages and tobacco, which went from 2.6 to 2.7 percent; housing, water and electricity which rose from -0.3 to 1.1 percent; and health , which climbed 2.7 percent from 2.6 percent in August. On a regional basis, annual inflation in the National capital Region (NCR) rose to 1.1 percent after its 01 percent decline in August. For Areas Outside NCR (AONCR), inflation increased to 3.1 percent from 2.7 percent recorded in August. Prices of consumer items at the national level increased to 0.6 percent from the 0.2 percent in August due to increases in prices of rice, corn, and fruits and vegetables.
Likewise per same published report, Department of Budget and Management Secretary Florencio Abad stated that the country’s budget gap is expected to remain within the PhP238 billion target, or approximately 2 percent of the country’s gross domestic product (GDP). Moreover, disbursements are expected to increase at the end of the year, marking a great improvement in spending. The budget secretary attributed these improvements to one-year appropriations that enabled projects to be implemented early.
Furthermore, the National Economic Development Authority (NEDA) stated that it expects the economy to maintain strong growth for the remaining months. The country, according to NEDA, is growing within the 6-to-7 percent target. Moreover, growth is expected to exceed targets due to improvements in the manufacturing sector and imports. Despite the optimism in growth, NEDA stated that it is monitoring other factors, namely the Federal Reserve’s tapering of quantitative easing and armed conflict in Zamboanga as possible risks to the country’s growth.
On the other hand, the Bureau of Internal Revenue (BIR) released Revenue Regulations 17-2013, which requires all taxpayers to preserve all books, registers, records, vouchers, and other supporting papers. Records must be preserved for a period of three years, with an exception of a 10 year preservation period should the taxpayer be accused of tax evasion or the taxpayer fail to file returns. As a result, the BIR suggested taxpayers to retain records for more than 10 years.
Lastly, domestic liquidity (M3) totalled PhP6.028 trillion in August, posting a 30.9 percent increase from the PhP4.604 trillion recorded in the same period last year. On a monthly basis, M3 grew by 30.1 percent. According to the BSP the expansion of credits in the domestic economy drove the increase in money supply. Moreover, the central bank’s operational adjustment on its Special Deposit Accounts (SDAs) allowed more money to be released in the economy. Thus, money supply grew to its fastest rate since 2002 according to the researchers of IDEA.
For comments, rejoinders and questions related to credit & collection, Mr. Ed F. Limtingco can be reached at elimtingco@yahoo.com