"This unilateral ceasefire would lessen the apprehension of the public this Christmas season," Duterte's spokesman Harry Roque said in a statement, adding the government expects the rebels to make "a similar gesture of goodwill".
The "suspension of offensive military operations", which will be in effect from December 24 to January 2, has been a customary move by both sides since the launch of formal talks in the late 1980s.
The 48-year-old conflict in the largely Catholic nation is one of Asia's longest-running insurgencies and has claimed 30,000 lives by the government's count.
However, Duterte cancelled peace talks last month and formally designated the Communist Party of the Philippines and its 3,800-member armed wing the New People's Army as "terrorist organisations".
He has also used the communists' guerrilla activities as a justification for prolonging martial law over the southern third of the country until December 31 next year.
Martial rule, which he proclaimed in May to combat Islamic militants who seized the southern city of Marawi, was initially set to end on December 31 after the defeat of the militants.
Duterte did not declare a Christmas truce with other armed groups, including self-proclaimed armed supporters of the Islamic State group still operating in the south.
Duterte's election last year revived hopes for successful negotiations as the president is a self-declared socialist who has said it is his "dream" to forge peace in the country.
But he cancelled peace talks in November after a rebel ambush in the southern Philippines killed a police officer and a four-month-old baby.
Duterte has also accused the communists of plotting with his political rivals to destabilise his rule.
He has since ordered the arrest of more than a dozen rebel leaders freed last year, and has threatened to shut down mining companies that yield to insurgents' demands for money.
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