Recto encouraged by further drop in inflation, pushes for more deliberate implementation of inflation reduction strategies

Finance Secretary Ralph G. Recto was encouraged by the further drop in the Philippines’ headline inflation to 2.8% in January 2024 and pushed for a more deliberate implementation of the Reduce Emerging Inflation Now (REIN) plan to keep the prices of goods and services stable.

“This positive development is very encouraging. As I’ve said before, our top priority is to reduce inflation and protect the purchasing power of the Filipino people. Addressing inflation will not only further grow the economy but it will help boost our revenue collection and improve the quality of life of Filipinos,” the Finance Chief said.

Inflation is the rate at which the overall prices of goods and services have increased over time.

The inflation rate in January is significantly slower than the 8.7% recorded in the same month last year and the 3.9% in December. It is also well within the government’s overall target band of 2% to 4%.

For the said month, inflation continued to decline due to slower increases in the prices of food items and non-alcoholic beverages.

Food inflation eased to 3.3% from a high of 11.2% in the same period a year ago and the 5.5% rate in December 2023. Compared to the previous month, the drop in food inflation was due mainly to the lower prices of vegetables and meat.

However, rice inflation increased compared to last month mainly due to higher prices in the international market as trade protectionism continued in India and weather disturbances affected crops in Thailand, which are the Philippines’ major sources of imported rice.

For non-food items, inflation declined to 2.0% from 7.3% in the same period in 2023 and 2.6% in December. This was mainly due to the lower contribution of housing rentals; electricity, gas, and other fuels; as well as food and beverage serving services or restaurants.

Government strategies under REIN

To further arrest inflation, the Department of Finance (DOF) will oversee the vigorous implementation of strategies under its REIN plan.

These initiatives involve closely monitoring financial assistance programs or ayuda aimed at supporting vulnerable sectors.

The focus lies on enhancing the efficiency of beneficiary identification, optimizing