PH January inflation hits 15-year high at 8.7%

MANILA, PHILIPPINES — Inflation in January accelerated to its 15-year high of 8.7% from 8.1% in December. 

According to the Philippine Statistics Authority (PSA), the main driver in this uptrend was the higher year-on-year increase in the index of housing, water, electricity, gas, and other fuels at 8.5%, from seven per cent in December 2022.  

This was followed by food and non-alcoholic beverages at 10.7%, from 10.2% in December 2022. 

Also contributed to the increase in inflation were restaurants and accommodation services, with an inflation rate of 7.6%. Food inflation at the national level also climbed to 11.2%. 

“The January 2023 inflation was the highest since November 2008 at 9.1%,” said national statistician and civil registrar general Dennis Mapa.

On the contrary, a lower annual increase was observed in the transport index at 11.2%. Meanwhile, the indices of information and communication, education services, and financial services remained at their previous month’s annual rates of 0.7%, 3.6%, and 0.0%, respectively.

In response to this higher-than-expected inflation, the Bangko Sentral ng Pilipinas (BSP) said that they are ready to tweak their monetary policy “to keep further second-round effects at bay and to prevent inflation expectations from becoming disanchored.”

“Our approach to monetary action will remain data-dependent and contingent on the inflation outlook, along with other available macroeconomic information at a given point in time,” the central bank added.