Cambodia's Inflation Forecast Raised to 5.1% in 2026, Outpacing Most of ASEAN

Cambodia is projected to experience one of Southeast Asia’s highest inflation rates, with consumer prices forecast to rise 5.1% in 2026, significantly outpacing the ASEAN average of 3.6% and the broader ASEAN+3 average of 1.6%, according to the latest ASEAN+3 Macroeconomic Research Office (AMRO) outlook. This represents an upward revision from AMRO's previous forecast of 4.5% for 2026. AMRO anticipates inflation will considerably slow to 2.8% in 2027, reflecting an expected moderation in global commodity prices and easing regional cost pressures. However, the 2026 forecast places Cambodia among the highest inflation economies in ASEAN, behind only Myanmar (20.0%), Lao PDR (8.1%), and the Philippines (5.7%). Despite the elevated inflation outlook, Cambodia’s economic growth forecast remains unchanged at 4.2% for 2026, with growth expected to accelerate to 4.9% in 2027. This suggests AMRO expects the economy to continue expanding even as consumer prices remain elevated. The primary drivers of inflation are identified as higher energy-related costs, including electricity and transport. Food prices, such as rice, have also begun to rise in some economies due to adverse weather and increased transportation costs. Fluctuations in crude oil prices, influenced by Middle East tensions, remain a significant risk factor for the regional economy. Across the ASEAN+3 region, economic growth has been slightly revised higher to 4.1% in 2026, supported by resilient domestic demand, investment, and strong AI-related exports. However, AMRO warns of risks including renewed spikes in energy and food prices, slower-than-expected AI demand, financial market volatility, and rising global trade protectionism. For Cambodia, inflation, rather than economic growth, is expected to be the key macroeconomic challenge over the next year. While the Kingdom’s economy is projected to expand steadily, consumer prices are forecast to rise considerably faster than in most neighboring economies before moderating in 2027 as global cost pressures ease.