INFLATION in the Philippines accelerated to 4.1% in March 2026, marking the highest rate in 20 months, according to data released by the Philippine Statistics Authority (PSA).
This surge is primarily attributed to escalating petroleum product prices, which have significantly driven up costs for transportation, food, and essential utilities. The PSA reported that the March inflation rate is a considerable increase from the 2.4% recorded in February 2026 and the 1.8% in March 2025. This marks the fastest inflation since July 2024, when it stood at 4.4%. Despite the recent spike, the year-to-date inflation remains within the government’s target range of 2% to 4%.
The transport index emerged as the main driver of the accelerated inflation, registering a 9.9% increase compared to a 0.3% decrease in the previous month.
This sector accounted for a substantial 54.8% of the overall inflation surge. National Statistician and PSA Chief Claire Dennis Mapa explained that the heightened transport inflation was due to price increases in gasoline and diesel, reversing the price decreases observed in February. Gasoline inflation soared to 27.3% in March from -5.7% in February, while diesel prices jumped to 59.5% from -1.3%. These increases are a direct consequence of successive oil price hikes in the country, mirroring the rising global oil prices fueled by the ongoing conflict between the US-Israel and Iran.
Beyond transportation, the Food and Non-Alcoholic Beverages index also contributed significantly to the inflationary pressure, rising to 3% in March from 1.8% in February, and accounting for 26.9% of the overall uptrend.
This rise was largely driven by increased prices of cereals, particularly rice, which saw a growth of 3.7% compared to a 1.3% contraction in the prior month. Additionally, the Housing, Water, Gas, and Other Fuels index climbed to 4.5% from 3.5%, contributing 12.7% to the overall increase. This was due to higher costs for electricity (9.2% from 6.7%), LPG (2.2% from -2.2%), and rent (3.2% from 3%). For the bottom 30% of households by income, inflation hit 4.2% in March, up from 2.5% in February, pushing the first-quarter average to 2.8%, largely influenced by a 3.9% rise in food and non-alcoholic beverages and a significant jump in transport expenses.
In response to these challenges, the Department of Economy, Planning, and Development (DEPDev) announced that the government has implemented a series of coordinated measures to curb inflation and mitigate the impact of the Middle East conflict on households and key economic sectors.
DEPDev Secretary Arsenio Balisacan stated that the government is prepared to address emerging inflation pressures through strategic interventions, particularly in fuel, transport, and food. Measures include activating the emergency fuel procurement program, securing substantial diesel supply for delivery through April to stabilize prices, and offering toll rebates for public utility vehicles and cargo trucks.
Anti-hoarding guidelines have also been enforced to prevent artificial shortages, and the P20 rice program has been expanded nationwide. Logistics support for vegetable transport and reduced Ro-Ro terminal fees for agricultural products are also in place to ensure efficient and affordable food distribution.
To further cushion the blow of high fuel prices, the government is providing service contracting, cash assistance, and fuel subsidies to vulnerable sectors such as public utility vehicle drivers, farmers, and fisherfolk. The government remains committed to ensuring continuous service delivery while enhancing economic resilience through a balance of short-term relief and long-term strategies.
