Philippine Jan annual inflation accelerates to 8.7%

FILE PHOTO-Vendors wearing face masks for protection against the coronavirus disease (COVID-19) stand by their fruit stalls at a public market in Quezon City, Metro Manila, Philippines, February 5, 2021. REUTERS/Eloisa Lopez

MANILA (Reuters) – Philippine inflation accelerated to a fresh 14-year high in January, the statistics agency said on Tuesday, keeping the pressure on the central bank to tighten monetary policy.

The consumer price index (CPI) rose 8.7% in January, way above the 7.7% forecast in a Reuters poll and topping the 8.1% rate in December.

Core inflation, which strips out volatile food and fuel items, increased to 7.4% from December’s 6.9%.

The Philippine central bank, which had forecast January CPI to be between 7.5%-8.3%, said on Saturday it will focus on inflation rather than the Federal Reserve’s 25-basis point hike when it meets on Feb. 16 to review key interest rates

Its governor has previously signalled further interest rates hikes at the central bank’s first two policy meetings this year to bring inflation back within a target range of 2% to 4%.

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