January inflation likely at 3.9 percent, says ING economist

ABS-CBN News

Posted at Feb 03 2022 11:04 AM | Updated as of Feb 04 2022 08:33 AM

People buy fish at a public market in Quezon City on January 19, 2021. George Calvelo, ABS-CBN News/File
People buy fish at a public market in Quezon City on January 19, 2021. George Calvelo, ABS-CBN News/File

MANILA - Inflation for the month of January is seen to have quickened in January, ING Bank Manila's chief economist Nicholas Mapa said Thursday. 

Inflation could settle at 3.9 percent in January based on the 2012 base prices from 3.6 percent in December 2021, Mapa told ANC. 

However, there was a "non-consensus" on the January inflation expectations as the Philippine Statistics Authority shifts to the 2018 base year to update the consumer price index (CPI) basket, he said. 

“Because of the shift to 2018, i guess that’s what’s causing the non-consensus forecast for January inflation…the shift to the 2018 as a base year, is intended to update the CPI basket to make our inflation numbers reflective of the patterns that we see,” Mapa said. 

Updating the base year used by the PSA will include higher spending in other items in the past years such as telecommunications and transport compared to the basket priorities in 2012, Mapa said.

Food remains as the top contributor in terms of weight, he added.

The PSA is set to release January's inflation number on Feb. 4.

For the full year, Mapa said their inflation forecast is at 3.6 percent, higher than the 3.4 percent target of the Bangko Sentral ng Pilipinas.

The BSP earlier said it won't issue its usual month-ahead inflation forecast for January until after the PSA completed the shift to the 2018 base year.

"This will allow the BSP to re-estimate its inflation models used in monetary policy analysis and macroeconomic forecasting," the central bank said.

The full year inflation in 2021 was 4.5 percent, after hovering above the government target of 2 to 4 percent for the majority of the year.

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