Inflation is Grinch stealing Christmas in Philippines

By BLOOMBERG

MANILA • Christmas will be a little less merry this year for Filipinos as soaring prices force many families to scrimp on festive food and gifts.

While inflation is starting to ease, hosting the traditional Noche Buena Christmas Eve dinner in the Philippines is still going to cost a lot more than a year ago. Items like glazed leg of ham, quezo de bola (cheese encased in red wax), fruit cocktails and cream, are about 5% more expensive, said Steve Cua, who heads an association of 23 supermarkets.

Juices have gone up by at least 10% and sodas have increased a whopping 45%.

Consumer prices rose 6% in November from a year ago, easing for the first time in 11 months, a report yesterday showed. Economists had estimated 6.3%. Inflation was 6.7% in October and September, the fastest pace in nine years.

“I used to buy individual gifts for all extended family members,” said Patricia Chiu, a media professional in Manila. “Now, I’m giving just one per branch of family. So, I’ve cut down from around 20 or more gifts to four.”

December is typically a strong month for consumer spending with workers receiving a legally mandated extra month of pay, while remittances from abroad are usually a record.

The new year may bring more cheer, with a drop in global oil prices helping to ease overall inflation. Bangko Sentral ng Pilipinas last month predicted inflation will return to the target range of 2% to 4% next year after breaching the goal this year.