MANILA (3rd UPDATE) - Inflation for the month of December quickened further mainly due to the higher prices of select food items including onions and other vegetables, the state statistics bureau said on Thursday.
The consumer price index rose 8.1 percent, faster than the 8 percent the previous month and the highest since November 2008, the Philippine Statistics Authority said.
Inflation of food and non-alcoholic beverages index in December was at 10.2 percent from 10 percent in November, while the total food inflation at the national level rose to 10.6 percent from 10.3 percent the previous month, PSA data showed.
National Statistician Dennis Mapa said the inflation rate in prices of vegetables, tubers, plantains, cooking bananas and pulses is at 32.4 percent for the month, which is the highest since February 1999.
Onion has a "substantial" contribution to inflation for the month after prices rose to P700 a kilo during the holidays.
“The onion, part of vegetable, for December, substantial yung kanyang contribution sa inflation (it has a substantial contribution). It contributed 0.3 percentage point to overall inflation. Same as rice,” Mapa said.
“Food inflation contributed 40 percent of the total inflation for December…medyo malaki ang contribution ng vegetables sa food inflation (vegetables had a huge contribution in food inflation),” he added.
Other food products that showed price increases for the month include meat, sugar, fish and flour, Mapa said.
But Mapa added there is a slowdown in inflation for other items.
December's inflation is within the Bangko Sentral ng Pilipinas' forecast of 7.8 to 8.6 percent. From January to December 2022, inflation averaged 5.8 percent, beyond the government's target of 2 to 4 percent.
The BSP in December raised the country's key policy rate to 5.5 percent to cool down the rising prices.
Inflation for 2023 is seen to average 4.5 percent before easing back to within target by 2024. Deceleration will be due to the easing of global oil and non-oil prices and the impact of the BSP's policy rate adjustments, the central bank said in a statement.
For 2023, upside risks to inflation include high fertilizer prices and supply chain constraints while domestic risks include trade restrictions, increased prices of fruits and vegetables, higher sugar prices and pending petitions for fare and wage hikes, the BSP said.
"The BSP remains prepared to take all monetary policy action necessary to bring inflation back to a target-consistent path over the medium-term. The BSP also continues to support the timely implementation of non-monetary government measures to mitigate the impact of persistent supply-side pressures on inflation," it said.
Meanwhile, Socioeconomic Planning Secretary Arsenio Balisacan said protecting the purchasing power of Filipinos remains a government priority as food prices soar.
“As part of the 8-point socioeconomic agenda of the Marcos administration and as laid out in the Philippine Development Plan (PDP) 2023-2028, the government will continue to prioritize addressing the impact of inflation as it remains to be a challenge not only in the country but throughout the globe,” he said.