The devastation caused by Typhoon Glenda on property, livelihoods and businesses this week will not wreak havoc on inflation, according to initial assessments made by the central bank in the aftermath of the storm.
“The extent of the damage caused by Glenda is still being assessed, but from what we have seen and from what the NDRRMC has reported, it looks like the effect of Glenda would be substantially less than the effects of stronger typhoons that struck the country in recent years,” Bangko Sentral ng Pilipinas (BSP) Governor Amando Tetangco Jr. told reporters on Friday.
NDRRMC refers to the government’s National Disaster Risk Reduction and Management Council.
Initial government estimates showed that the typhoon’s damage to property exceeded P5 billion, with P892 million in infrastructure and P4.529 billion in agriculture.
The Department of Agriculture said agriculture and fisheries in 15 provinces in four regions were affected by Glenda, including Quezon province, all of Mindoro, the entire Bicol Region, and the provinces of Leyte, Southern Leyte, Biliran, Samar, Eastern Samar, and Northern Samar in the Eastern Visayas.
Despite his initial optimism, Tetangco acknowledged that the central bank will still have to see the estimates of damages as they are updated and evaluate the potential impact of the typhoon on the country’s inflation rate.
“But given the average inflation rate right now . . . I don’t think this [Glenda] will threaten the inflation target. I believe we’ll still be able to remain within the inflation target for this year as well as next year,” he said.
The country’s inflation rate averaged 4.2 percent in the first six months of the year on the back of higher food prices. The government said spikes in food prices can be attributed to supply disruptions caused by the recent typhoons.
For its part, the central bank said it will remain vigilant against potential risks to the 3-percent to 5-percent inflation target for this year as well as the 2-percent to 4-percent target for next year.