Philippine inflation hits 17-year high
Inflation in the Philippines surged to 12.5 percent in August, a 17-year high, the government said Friday, warning that the rise could impact economic growth targets for this year.
The National Statistics Office also revised upward the inflation rate in July to 12.3 percent from 12.2 percent.
This brought the average inflation rate for the eight months to August to 8.8 percent.
"This figure is within (the National Economic and Development Authority's) inflation forecast of 12.1 to 12.7 percent," said its director-general Ralph Recto.
"But with this trend, meeting the 5.5 percent growth for the year would be a tough challenge, though it remains our fighting target," Recto said in a statement.
Soaring food and energy prices have already slowed economic growth to 4.6 percent in the first half, down sharply from more than seven percent for the whole of 2007.
"Annual inflation rates were higher in the commodity groups except in the food, beverages and tobacco index," the statistics office said in a statement.
The news sent Philippine shares prices 1.1 percent down at Friday's close.
Goldman Sachs told Dow Jones Newswires it expects the central bank to raise its key interest rates by 25 basis points this year, probably on October 9, to rein in inflation.
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