Purchasing power of peso shrinks to 86 centavos in July 2022

One Philippine peso is currently worth 86 centavos. The deflating news was shared in a press briefing led by Philippine Statistics Authority (PSA) chief and National Statistician Claire Dennis Mapa on Thursday, August 4. The value of the Philippine dropped one centavo drop from 87 centavos in July 2018, due mainly to inflation, or the rate of increase in the prices of commodities and services.

The purchasing power of the peso is defined in the PSA website as the measure of the real value of the peso in a given period relative to a chosen reference period. Simply put, it is the value of the peso expressed in terms of the number of goods or services that one peso can buy.

Of course, we didn’t need the PSA to tell us this. We’ve all been feeling the pinch with every trip to the supermarket and the gas station and every time we place a Grab Food order. We’re not paying more for the same cart of groceries and fast food order. The question is: how long can be hold on like this?

Rizal Commercial Banking Corp. chief economist Michael Ricafort attributed the decline in the value of the peso to the Philippine inflation, which rose to 6.4% in July 2022, and the weakening of the peso against the US. dollar.

Mr. Ricafort didn’t say it, but allow us to add the economists’ whipping boy du jour–the COVID-19 pandemic and the war in Ukraine, to the reasons why we’re in such an economic quagmire.