Philippine Inflation Hits Highest Level Since 2008
The Philippine Statistics Authority (PSA) announced today that the annual inflation rate in the Philippines rose to 8.7% in January 2023, from 8.1% in December 2022¹⁴. This is the highest inflation rate recorded since November 2008¹³, and well above the market expectations of 7.7%¹.
The PSA attributed the surge in inflation mainly to rising prices of housing, electricity, gas, and other fuels, which increased by 8.5% year-on-year in January 2023, compared to 7% in December 2022¹. Other factors that contributed to higher inflation were food & non-alcoholic beverages (9.6% vs 9.4%), transport (10.2% vs 9%), health (6.5% vs 6%), and education (5.4% vs 5%)¹.
The PSA also reported that core inflation, which excludes volatile items such as food and energy, rose to 6.3% in January 2023, from 5.9% in December 2022¹. This indicates that inflationary pressures are broadening across various sectors of the economy.
The Bangko Sentral ng Pilipinas (BSP), the country's central bank, has been tightening its monetary policy stance since November last year to curb inflation and support the peso amid external headwinds such as rising oil prices and global supply chain disruptions². The BSP has raised its key policy rate by a cumulative of one percentage point to four percent as of its latest meeting on January 20th².
The BSP has also revised its inflation forecast for this year upward to six percent from five percent previously, citing higher risks from supply-side shocks and demand pressures². The BSP said it will continue to monitor price developments closely and act accordingly to ensure price stability conducive to sustainable economic growth.
For more information on Philippine inflation statistics, please visit
https://www.psa.gov.ph/price-indices/cpiSource: Conversation with Bing, 27/02/2023(1) Philippines Inflation Rate - January 2023 Data - 1958-2022 Historical.
https://tradingeconomics.com/philippines/inflation-cpi Accessed 27/02/2023.
(2) January 2023 inflation hits 8.7% | Philippine News Agency.
https://www.pna.gov.ph/articles/1194571 Accessed 27/02/2023.
(3) Philippines Inflation Rate - January 2023 Data - 1958-2022 Historical.
https://tradingeconomics.com/philippines/inflation-cpi Accessed 27/02/2023.
(4) Philippines inflation and the economy | Philstar.com.
https://www.philstar.com/business/2022/08/17/2203097/philippines-inflation-and-economy Accessed 27/02/2023.
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