PH Inflation Soars to 14-Year High 7.7%

Inflation in the Philippines soared to just under a 14-year high in October as the inflation rate of the country nearly matched the recorded rate during the height of the 2008 global financial crisis.

This comes as the Philippine Statistics Authority (PSA) reported the inflation rate of October, which was recorded at 7.7 percent, leagues above the recorded inflation rate during September recorded at 6.9 percent.

The surge in the inflation rate was brought about by external price pressures, the ongoing Russian invasion of Ukraine, the continuing disruption of global supply chains, coupled with the effect of numerous recent typhoons that ravaged the country.

The 7.7 percent October inflation rate fell within the 7.1 to 7.9 percent forecast range of the PSA.

The October rate brings the average year-to-date inflation of the country to 5.4 percent, which is higher than the Philippines’ target of 2 percent to 4 percent.

PSA chief Dennis Mapa said that the inflation rate of October is just short of the last highest inflation rate the country experienced which was recorded during the global financial crisis.

“The last highest was December 2008, 7.8%. Of course, 2008 was the year of global financial crisis,” Mapa said.

The latest inflation rate might not even be the peak yet, as global financial institution ING said that they expect “price pressures to remain potent.”

Moreover, the impact of Severe Tropical Storm Paeng (international name: Nalgae) will also drive further surge in the inflation rate of the country, ING added.

The financial institution said that the country may see an 8 percent inflation rate by December, according to ING Philippines Senior Economist Nicholas Mapa.

“The confluence of supply and demand side pressures should push headline inflation close to 8% by December before drifting slowly lower in the first half of 2023, as second-round effects are likely to linger,” Mapa said. (GFB)