Gov’t records slower December inflation, but misses 2023 target

Metro Manila (CNN Philippines, January 5) — Commodity price movements remained on a downtrend, slowing to 3.9% in December, bringing the full-year average to 6%, the Philippine Statistics Authority (PSA) reported on Friday.

Data from the PSA showed that the inflation rate was down from the 4.1% recorded in November.

December's rate is within the 3.6% to 4.4% forecast range of the Bangko Sentral ng Pilipinas (BSP) for the month.

However, the cooler December data was not enough to bring down the annual average rate for last year, with the government failing to hit the 2% to 4% target range.

In a briefing, National Statistician Dennis Mapa said the main sources of deceleration were housing, water, power, gas and other fuels, and food and non-alcoholic beverages.

Mapa said the inflation rate in the capital region also fell to 3.5% in December. Areas outside Metro Manila also recorded lower inflation at 4%.

Only eight regions logged slower inflation in the period, the official added.

Bangsamoro had the highest inflation rate last month at 6.2%, while Cagayan Valley recorded the coolest at 1.6%.

The BSP previously said it expects the inflation rate to return to the target path by the first quarter of this year.

But in a statement on Friday, the central bank said the balance of risks to inflation "continues to lean significantly toward the upside" due to the projected impact of strong El Niño on transportation, oil, food, and power.

"Looking ahead, the Monetary Board deems it necessary to keep monetary policy settings sufficiently tight until a sustained downtrend in inflation becomes evident," it said.

President Ferdinand Marcos Jr., meanwhile, welcomed the development.

Marcos assured the public that his administration would continue to impose measures to curb high inflation while strengthening the economy.