Philippines: Inflation back to target levels in December

MANILA, Philippines — Inflation eased in December, due in part to the slower increase in prices of key consumer items, and fell back to the national government’s target.

Inflation, as measured in the consumer price index, picked up 3.6% year-on-year in December, the Philippine Statistics Authority reported Wednesday. This was slower than the 4.2% clip recorded in November.

Inflation in December fell within the Bangko Sentral ng Pilipinas’ forecast range of 3.5-4.3% for the month.

But for the entire 2021, inflation averaged 4.5%, breaching the Duterte administration’s target 2-4% annual target.

In a statement, the BSP said it would include Typhoon ‘Odette’s’ impact into its forecasts once figures are available, since the deadly storm’s aftermath would result in temporary price increase in the coming months.

“The supply disruptions and agricultural damages from typhoon Odette will likely result in a temporary uptick in the prices of food items and other necessities over the near term,” the BSP said in a statement.

“The BSP will have to include the typhoon’s impact into its projections once firm estimates become available. At the same time, the implementation of reconstruction efforts and rehabilitation programs in areas damaged by the storm will be essential to support economic recovery and prevent job losses,” it added.