Inflation

Inflation is the general rise in prices across an economy over time. When there's inflation, each peso buys a little less than it did before, so the same money stretches less far at the store.

A little inflation is normal and even expected in a healthy economy. The problem is when prices rise quickly, because incomes often don't keep up, and everyday costs like food and transport start to sting.

Inflation is also why cash left sitting under a mattress quietly loses value. It's one of the main reasons people save in interest-bearing accounts and invest, to try to keep ahead of rising prices.

If a bowl of your favorite noodles cost ₱50 a few years ago and now costs ₱65, that increase is inflation at work. Your ₱50 no longer buys the same meal.