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.”

The consequence of inflation

“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.

CPI now on its fastest pace since 2014

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.