Beating the Inflation – Know How

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by Rick Daligdig

The Inflation for December 2022 is pegged at 8.1%. The culminating of continuing upward trend of inflation for last year. Year-on-year headline inflation averaged at 5.8 percent in 2022, exceeding the Government’s announced inflation target range of 2.0-4.0 percent for the year. Prices of agricultural commodities such as rice, fruits, and nuts registered higher inflation prints, while vegetables and sugar continued to record elevated double-digit inflation. Similarly, non-food inflation was higher year-on-year due primarily to restaurant and accommodation services inflation, alongside faster price increases for electricity, gas, and other fuels, as well as higher power rates. For this year, the government is anchoring its hopes that inflation will decelerate due to easing global oil and non-oil prices, negative base effects, as well as the impact of the BSP’s cumulative policy interest rate increases working their way through the economy.

While others are busy blaming the government due to the high price of onions (which somehow is true), We must look for other ways to fight this skyrocketing inflation in our finances, especially on how we will grow our money. Besides inflation concerns, we must also consider some factors that will affect the economy. As for our 2023 GDP outlook, the outlook is placed at a 6.0% to 7% full-year growth target. The outlook was tempered by rising interest rates and inflation. But still Philippine economy can yield reasonable growth meaning the recession scenario is far from the picture.

The question now is, where we will place our money to preserve or grow? As for our Philippine Stocks Exchange Inc (PSEi), it began in a strong week despite the headline inflation. Last Friday was close at 6,767.33 with the PSEi’s support at 6,600 and resistance at 6,800 and this is a good opportunity to start or increase your investment. Depending on your purpose for investing in stocks these are the recommended Stocks for 2023.

Banks – BPI and Metrobank

Food and Retail – Jollibee. Universal Robina, Puregold , SM Prime Holdings

Power and Port – Aboitiz Power, ACEN, ICCT

Dividend Yield – Citicore, AReit, Semirara Mining, and Power Corp.

For first-time investors, it is highly recommended portfolio allocation for REITs to temper portfolio volatility.

Monitoring of these economic drivers will likely be key to the investment strategy for this year. Improving data outcomes will result in strong BUYs. Yes, we have tools to fight inflation or at least minimize its impact on our pockets. We just need to know and learn how to invest and make it grow.

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