January 2023 inflation hits 8.7%

By Kris Crismundo

February 7, 2023, 1:03 pm

MANILA – The country’s headline inflation rate in January 2023 increased to 8.7 percent from 8.1 percent in December 2022, Philippine Statistics Authority (PSA) Undersecretary Dennis Mapa reported Tuesday.

Mapa said the rate of price increments of goods and services in January this year is also higher than the 3 percent inflation in January 2022.

He said the main driver of inflation last month was housing, water, electricity, gas and other fuels, with inflation of 8.5 percent, and contributing 50.8 percent to the uptrend in January inflation.

“The largest item that has the biggest weight in housing, water, electricity, gas and other fuels is the rental, housing rental. Because of the opening up of the economy, (in) January, I think they have adjusted the rates,” he added in mixed English and Filipino.

Mapa said rental rates in the past three years during the height of the pandemic have been stable, with inflation of 2.5 percent in 2020, 1.3 percent in 2021 and 2.5 percent in 2022.

He said the upward adjustments in water tariff and electricity rates have contributed to the acceleration of price increases in the previous month.

Increasing prices of food and non-alcoholic beverages also shared to the higher inflation at the start of 2023, which is driven by more expensive prices of vegetables, tubers and the likes; milk, other dairy products and eggs; and fruits and nuts.

The third largest contributor to inflation in January 2023 is restaurants and accommodation services.

Items with faster increase in prices in January were mostly from the food basket, led by fruits and nuts; vegetables, tubers, and the likes; and sugar, confectionery and desserts.

On the other hand, items that had slower inflation last month include rice; flour and bread; oils and fats; and ready-made food and other food products.

Inflation in the National Capital Region (NCR) was at 8.6 percent, while in areas outside NCR (AONCR) was at 8.7 percent last month.

The biggest contributor to inflation in both NCR and AONCR in January is still housing, water, electricity, gas and other fuels.

Mapa said Western Visayas reported the highest inflation in January at 10.3 percent.

The government targets inflation to settle within 2.5 to 4.5 percent this year.

Despite the high inflation at the start of the year, Mapa said initiatives to slow down price increases will help the government to achieve its inflation target. (PNA)