Philippines December inflation at 14-year high as food prices jump

PHILIPPINES annual inflation in December accelerated to its fastest pace since 2008, driven by spikes in food and energy prices, the statistics agency said on Thursday (Jan 5).

Last month’s inflation figure was slightly below the 8.2 per cent median forecast in a Reuters poll, but within the central bank’s 7.8 per cent to 8.6 per cent forecast for December. It brought the full-year average rate to 5.8 per cent, outside the official 2-4 per cent target band.

Core inflation, which strips out volatile food and energy components, rose to 6.9 per cent in December from 6.5 per cent in November.

Food inflation at the national level rose further to 10.6 per cent in December from the prior month’s 10.3 per cent, largely driven by commodities including vegetables and rice.

The Philippines central bank has not ruled out further interest rate hikes in 2023, after raising the benchmark by a total of 350 basis points last year to curb inflation and support a weak peso. REUTERS