P1 in 2018 now worth only 73 centavos

The Philippine peso has lost another two centavos in purchasing power, with P1 in 2018 now worth only 73 centavos, according to National Statistician Claire Dennis Mapa.

Speaking at a Tuesday morning press conference of the Philippine Statistics Authority (PSA), Mapa said the further acceleration of headline inflation in April reflects the peso’s eroding purchasing power, which he noted is now at its “lowest since we rebased it in 2018.”

“When inflation increases, the consequence is that the purchasing power of the peso declines,” Mapa said.

The PSA defines the purchasing power of the peso as a measure of the “real value” of the currency relative to a base year—2018—indicating how much goods and services it can buy.

Purchasing power is calculated using the consumer price index (CPI), which tracks changes in the cost of a basket of goods and services. As prices rise, each peso buys less—affecting households’ ability to afford essentials such as food, transport, and utilities. The PSA also uses the CPI to compute inflation, which has now reached its fastest pace since July 2024, when it hit 4.4%.

The decline over the past eight years reflects the cumulative impact of rising prices, as inflation steadily erodes the real value of money. In practical terms, goods and services that cost P100 in 2018 now cost about P137.

The local currency has also weakened to record lows against the US dollar eight times since the escalation of the Middle East conflict in early March, breaching both the P60 and P61 levels before hitting a low of P61.56 last Wednesday, 29 April. It previously traded at P57.66 on 27 February, prior to the conflict’s escalation, depreciating by about 7 percent to date.

At the same briefing, the PSA also reported that headline inflation accelerated further to 7.2% in April, driven by higher fuel, transport, and food costs stemming from the Middle East conflict. The central bank flagged the peso’s recent depreciation against the greenback as a driver in the monthly surge in inflation.