2025 inflation stays below gov’t target despite rising to 1.8% in December

MANILA, Philippines – Inflation quickened to 1.8% in December 2025 as strong holiday demand pushed up prices of major food items, the Philippine Statistics Authority reported on Tuesday, January 6.

This brings the average inflation rate for 2025 to 1.7%, below the government’s target range of 2% to 4%.

According to National Statistician Dennis Mapa, food prices rose at a faster pace in December amid the holiday demand. Recent tropical cyclones also disrupted agricultural production, which led to higher food prices.

“Kung naalala ‘nyo, ‘yung buwan ng Nobyembre, may malalakas tayo na bagyo. And this most probably impacted also ‘yung mga vegetable farms natin kaya tumaas ‘yung presyo, particularly sa labas ng National Capital Region,” he explained.

(If you recall, we were hit by strong tropical cyclones in November. And this most probably also impacted our vegetable farms, hence the higher prices particularly outside the National Capital Region.)

Rice deflation was at -12.3% in December from -15.4% in November, which means prices are now beginning to drop at a slower pace. Prices of vegetables such as eggplant (29.4%), okra (28%), and string beans (24%) notably saw double-digit inflation. Onions and shallots were also among the top contributors to December’s inflation figure, with a 79% inflation rate from 48.2% in November.

Image from Philippine Statistics Authority

In Metro Manila, inflation eased to 2.3% from November’s 2.8% due to a slower rise in power rates. Meanwhile, inflation for areas outside the capital region accelerated to 1.7% from the previous month’s 1.2% due to higher food prices.

The Central Visayas region continued to record the fastest inflation rate at 3.8%, while the Bangsamoro Autonomous Region in Muslim Mindanao continued to log deflation at -1%. Deflation or a negative inflation rate means the general level of prices is going down.

Department of Economy, Planning, and Development (DEPDev) Secretary Arsenio Balisacan said the latest inflation print reflected a “proactive and well-coordinated” approach to stabilizing prices and safeguarding Filipinos’ purchasing power.

“Building on this momentum, the government will continue to pursue prudent fiscal and monetary coordination and advance structural reforms to sustain the downward inflation trend and support inclusive growth in 2026 and beyond,” he said.

DEPDev added that the government is committed to keeping inflation within the 2% to 4% target for the remainder of President Ferdinand Marcos Jr.’s term. Balisacan noted that the 2026 national budget includes a P297.1-billion allocation for the agriculture sector, which aims to boost farmer productivity and strengthen food security.

The Bangko Sentral ng Pilipinas earlier forecast inflation in December would settle between 1.2% and 2% due to higher food and gasoline prices. – with reports from Arriane dela Cruz/Rappler.com

Arriane dela Cruz is a Rappler intern. Learn more about Rappler’s internship program here.