Inflation rate rose to 2.9 percent in December from 2.5 percent in November, led by higher prices for housing, water, electricity, gas and other fuels, the Philippine Statistics Authority (PSA) said Tuesday.
The December inflation brought the 2024 average to 3.2 percent — well within the government’s target range of 2 percent to 4 percent. Inflation rate was at 3.9 percent in December 2023.
Data showed that inflation for food and non-alcoholic beverages fell to 4.4 percent in 2024 from 7.9 percent in 2023. Rice inflation, in particular, slowed to 0.8 percent in December 2024, the lowest since January 2022.
“The 3.2-percent average inflation rate in 2024 is a significant improvement from the 6.0 percent figure in 2023. Despite the risks we encountered throughout the year, our combined efforts to temper inflation have largely been successful. We will build upon this momentum as we commit to keep the inflation rate within our target range in 2025,” said National Economic and Development Authority (NEDA) Secretary Arsenio Balisacan.
The Development Budget Coordination Committee (DBCC) announced during its Dec. 2, 2024 meeting that the government retained its annual inflation target of 2 percent to 4 percent for 2025 to 2028.
The Bangko Sentral ng Pilipinas said the latest inflation outturn was consistent with its assessment that inflation would remain anchored to the target range over the policy horizon.
“Nonetheless, the balance of risks to the inflation outlook continues to lean to the upside due largely to potential upward adjustments in transport fares and electricity rates. The impact of lower import tariffs on rice remains the main downside risk to inflation,” the BSP said.
“Domestic demand is likely to remain firm but subdued. Private domestic spending is expected to be supported by easing inflation and improving labor market conditions. However, downside risks in the external environment could materialize and temper economic activity and market sentiment,” it said.
It said the within-target inflation outlook and well-anchored inflation expectations continue to support the BSP’s shift toward less restrictive monetary policy. “Nonetheless, the monetary authority will continue to closely monitor the emerging upside risks to inflation, notably geopolitical factors,” it said.
Finance Secretary Ralph Recto credited the easing of the 2024 inflation to effective government interventions that sustained the moderation of rice prices, providing much-needed relief to low-income families.
“With the President’s decisive leadership, whole-of-government approach, and concerted efforts of stakeholders, we were able to manage the inflation to finally settle within our target after two years. The sustained moderation in rice prices is particularly a welcome relief especially to our lower-income households and highlights the positive impact of our interventions,” said Recto.
