MANILA (3rd UPDATE) — Inflation in November quickened further as prices of select items continued to rise and as consumption picked up during the holiday season, the state statistics bureau said on Tuesday.

Inflation hit 8 percent last month, higher than the 7.7 percent inflation posted in October and double the upper limit of the government's 2 to 4 percent target range, data from the Philippine Statistics Authority showed.

November's inflation, which is also the highest since the 9.1 percent rate in November 2008, is within the Bangko Sentral ng Pilipinas' forecast of 7.4 to 8.2 percent. The average inflation for the year is now at 5.6 percent.

The main contributors to the higher inflation for the month include food and non-alcoholic beverages such as vegetables with inflation at 10 percent from 9.4 percent, Officer-in-Charge and Deputy National Statistician Divina Gracia Del Prado said in a briefing.

“I think yung vegetables kasi meron tayong typhoon towards the end of October. I think this is a spillover effect nung typhoon natin,” Del Prado said.

(There were typhoons towards the end of October. This could be a spillover effect.)

Red onion registered a 15.8 inflation compared to the previous month and 47.2 percent year-on-year, Del Prado said. Other vegetables with an uptick in inflation include ampalaya, tomato and eggplant, she said.

Restaurants and accommodation services also contributed to the uptrend with an inflation of 6.5 percent from 5.7 percent the previous month, she added.

Inflation is also higher in furnishings and household equipment, clothing and footwear, health, inflation and communication, recreation, education services and personal care, the PSA said.

The government must ensure that supply can keep up with demand to temper inflation, BPI lead economist Jun Neri said.

But Neri said there could be a slow decline in inflation next year due to a currency rebound, among others.

“I think we’re pretty close to the peak. We’re hopeful that we will not exceed 9 percent but going back to 4 percent will take a while, the upper end of the BSP target,” Neri said.

Inflation is widely expected to remain elevated to around 5.8 percent in 2022 and 4.3 percent in 2023 before easing back within target by 2024.

"The key upside risks are the potential impact on international food prices of higher fertilizer prices, trade restrictions and adverse global weather conditions. Higher food prices from further domestic weather-related disturbances and supply disruptions in key food commodities such as sugar and meat, as well as pending petitions for transport fare hikes were also identified as upside risks to the inflation outlook in the latest round," the BSP said.

"The Monetary Board will continue to assess the country’s inflation outlook and macroeconomic prospects in its monetary policy meeting on 15 December 2022. The BSP remains prepared to take all further monetary policy actions necessary to bring inflation back to a target-consistent path over the medium-term," it added.

The BSP is also expected to hike interest rates before the end of the year to fight inflation and to match the anticipated slower hike by the US Federal Reserve.

The Philippines' benchmark rate is currently at 5 percent.

• Bangko Sentral hikes benchmark interest rate by 75-bps to match Fed, fight inflation

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