While the 5.2% inflation rate in June is alarming enough, it is still an understatement of the severity of the Philippine inflation.

According to the Philippine Statistics Authority (PSA), of the consumer goods and services included in the consumer measure, the most essential items on food and non-alcoholic beverages registered an even higher inflation rate of 6.1%.

The Tax Reform for Acceleration and Inclusion (TRAIN) law cannot be blameless for the current inflation problem because its imposition of higher excise taxes on petroleum products, among others, has cascaded into the shallow pockets of ordinary Filipinos who are now confronted with higher costs of fuel, transport, electricity, and commodities and services due to increased production cost.

Duterte’s economic managers must not refuse to study a rigorous quantification of the effects of the TRAIN law, rather than nonchalantly pointing to other factors like global oil prices and peso depreciation, including the purported buying propensity of Filipinos, as culprits.

Deputy Governor Diwa Guinigundo of the Banko Sentral ng Pilipinas (BSP) admitted that the inflation rate will remain elevated for the rest of the year and will still spike later in 2018.

The BSP’s plan to again increase interest rates may constrict investments and subsequently depress employment even as the consumers will have to earn more to buy the same quantity of goods and services.

Moreover, Philippine employment figures are not encouraging because from 5.0% in January, unemployment rose to 5.3% in March and is projected to climb to 5.8% this July.

EDCEL C. LAGMAN