Philippine inflation rose to 1.8 percent in December 2025 from 1.5 percent in November due to agricultural disruptions caused by Typhoon Uwan, the Philippine Statistics Authority (PSA) said Tuesday.
The December figure brought the average full-year inflation for 2025 to 1.7 percent. This landed below the government target range of 2 percent to 4 percent for the year.
Department of Economy, Planning and Development Secretary Arsenio Balisacan said the economy remained resilient against global headwinds due to timely and targeted interventions.
The uptick in the final month of the year was led by food inflation, which climbed to 1.2 percent from -0.3 percent in November. Vegetable price growth accelerated to 11.6 percent from 4 percent, with onion prices surging 79 percent. Fish inflation also ticked up to 9 percent from 8.6 percent because of limited import arrivals.
These increases were tempered by slower price growth in meat products, which fell to 3 percent from 4.2 percent. A decline in African swine fever cases helped lower pork inflation to 4.8 percent from 7 percent, while surplus supply pulled chicken inflation down to 0.7 percent. Rice prices continued to record deflation at -12.3 percent.
The government said it aims to maintain inflation within a 2 percent to 4 percent target range from 2026 to 2028. To support this, the 2026 national budget includes a P297.1 billion allocation for the agriculture sector. The funds will prioritize farm-to-market roads, cold storage facilities, and rice mills to boost productivity and food security.
The Department of Energy is accelerating 200 power generation projects to manage energy price pressures as electricity demand rises.
DEPDEv Secretary Arsenio Balisacan said these initiatives are part of a broader thrust to attain food security and enhance the quality of public service delivery.
The Bangko Sentral ng Pilipinas (BSP) said the inflation outlook remains benign and well-anchored.
“For 2026 and 2027, inflation is expected to settle within the 2 percent to 4 percent target,” the BSP said in a statement.
HSBC ASEAN economist Aris Dacanay said in a commentary that they do not see the upside surprise in December inflation derailing their view about the BSP’s further monetary easing cycle.
“Our baseline scenario is for the Fed to keep its policy rate range unchanged at 3.50 to 3.75 percent throughout 2026. Hence, we expect only one more quarter-point rate cut by the BSP in [the first quarter of] 2026, bringing the policy rate to 4.25 percent,” said Dacanay.
Meanwhile, Reyes Tacandong & Co. senior adviser Jonathan Ravelas said the December figure’s impact on fourth-quarter growth is mixed.
“Higher food prices may pinch wallets short term, but overall low inflation supports consumption and keeps the economy resilient. But then again upside risks to inflation remain,” said Ravelas.
Editor’s Note: This story has been updated. Originally posted with the headline “Philippines’ inflation outlook remains benign—BSP.”
