MANILA (Reuters) – Annual inflation in the Philippines rose for a third straight month in December due to a faster pace of increases in food and utility costs, the statistics agency said on Tuesday.
The consumer price index (CPI) rose 2.9% in December, more than the 2.6% forecast in a Reuters poll, and above the previous month’s 2.5% rate.
December’s inflation print put average inflation in 2024 at 3.2%, within the central bank’s target of 2%-4% for the year, marking the first time since 2021 that the Philippines has hit its inflation target.
“Overall, the outlook for within-target inflation and well-anchored inflation expectations continue to support the BSP’s move toward a less restrictive monetary policy,” the Bangko Sentral ng Pilipinas (BSP) said in a statement.
Core inflation, which excludes volatile food and energy items, was 2.8% in December, accelerating from 2.5% in November.
Last month, the Bangko Sentral ng Pilipinas (BSP) cut its key interest rate by 25 basis points to 5.75%, its third consecutive cut, and signaled that further easing this year could come in “small steps” as inflation remains worrying.
A strong majority in a Reuters poll of 24 economists in December forecast a further cut of 25 basis points each quarter over the next nine months, taking the rate to 5.00% by the end of September 2025.
“Looking ahead, the Monetary Board will maintain a measured approach to monetary policy easing to ensure price stability conducive to sustainable economic growth and employment,” the BSP said.
