SEN. Loren Legarda warned against a looming double-digit inflation amid skyrocketing food and fuel prices.

Legarda raised the alarm in the wake of a prediction by Goldman Sachs Group Inc. on the likelihood of a “super spike” that may send global oil prices soaring to $150 to $200 per barrel in six to 24 months.

Legarda suggested that in order to stave off inflation, the Bangko Sentral ng Pilipinas should allow the peso to strengthen against the dollar or eventually raise interest rates, or do both.

She noted that last month’s inflation rate brought to 6.2 percent the average inflation rate in the first four months of the year, well above the BSP’s original full-year target of 3 percent to 5 percent.

Inflation is a sustained increase in the general level of prices of goods and services. As inflation rises, each peso earned by a household buys a smaller percentage of a product or service.

To help ordinary Filipinos cope with soaring prices, she proposed that all regional wage boards grant pay increases for private-sector workers, and moved that Congress temporarily suspend the 12-percent value- added tax (VAT) on oil and petroleum products.

She also suggested that the National Food Authority should continue selling low-priced, government-subsidized rice to marginal households countrywide.

The temporary suspension of the VAT on oil would instantly lower pump prices by about P5 per liter, and in the case of cooking gas, by around P50 per tank, she added. “There is no question that the temporary lifting of the VAT on oil will extend material relief to consumers,” she said.

PHILIPPINE monetary authorities recognized Thursday the good a strong peso plays in keeping inflation manageable, but reiterated they would pursue a policy of leaving the exchange rate to market forces even if this means a more arduous monetary management.

THE PESO yesterday extended a two-day decline prompted by soaring oil and rice prices, as well as inflationary woes.

The situation has caused investors to squirrel away their dollars, increasing overseas demand for the greenback but not enough remittances to cover the demand, currency traders said.

MADRID, Spain—The Philippine government is confident pursuing more public-private partnerships (PPPs) in the light of the new vision of the Asian Development Bank (ADB) will provide financial relief to and stop the “bleeding” of government agencies.

SEN. Loren Legarda warned against a looming double-digit inflation amid skyrocketing food and fuel prices.

Legarda raised the alarm in the wake of a prediction by Goldman Sachs Group Inc. on the likelihood of a “super spike” that may send global oil prices soaring to $150 to $200 per barrel in six to 24 months.