Diokno expects inflation to ease in the second quarter

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Budget Secretary Ben Diokno (FILE PHOTO)

Metro Manila (CNN Philippines, February 13) — Budget Secretary Ben Diokno expects inflation to start easing by the second quarter, raising chances of the government meeting its 2019 full-year target range of 2 to 4 percent.

"In fact, there are scenarios where we'll see inflation at around two percent, maybe third or fourth quarter," he said at a media forum Wednesday.

Diokno said inflation will taper off by the second quarter as there is already a "significant" drop from the December rate of 5.1 percent to the January figure of 4.4 percent.

Strenghtening agriculture

The Budget Chief explained that economic managers are coordinating with other agencies, particularly the Department of Agriculture and the National Economic Development Authority, to strengthen the agricultural sector.

The sector posted a mere 0.1 percent growth last year which the Philippine Statistics Authority (PSA)  cited as a driving factor in the slowdown of the country's 2018 gross domestic product (GDP) to 6.2 percent.

"Simply put the farm sector had virtually zero contribution to economic growth last year," Diokno noted.

If the agriculture sector had grown as high as its 4 percent potential last year, it would have allowed the government to hit the low end  of its GDP growth target of 6.5 percent.

Diokno also suggested that farmers shift to from planting rice to high-value crops such as sugar.