Inflation Rate in Eastern Visayas Eases to 2.8% in April 2021

Reference Number: 

SR-202105-0800-16

Release Date: 

Thursday, May 20, 2021

Inflation Rate (IR) in Eastern Visayas eased to 2.8 percent in April 2021. This IR is 0.1 percentage point lower compared with the 2.9 percent IR in March 2021. This April IR of the region, however, is 1.0 percentage point higher than the recorded 1.8 percent IR in the same period last year.

In comparison with the national average IR, the regional IR is 1.7 percentage points lower than the 4.5 percent national IR in April 2021.

Eastern Visayas’ IR of 2.8 percent ranked second lowest among the regions in April 2021, while Central Visayas registered the lowest IR at 1.9 percent.

On the other hand, Bicol posted the highest IR at 7.9 percent, followed by Cagayan Valley at 6.9 percent. MIMAROPA and CALABARZON both recorded 5.8 percent IR and registered the third highest IR among the regions in April 2021.

BY PROVINCE

Among the provinces, only Northern Samar and Leyte registered decreases in IRs. Northern Samar’s IR declined to 0.7 percent in April 2021 from 2.2 percent in March 2021, a reduction by 1.5 percentage points.  Leyte’s IR, meanwhile, eased to 1.4 percent in April 2021 from 1.9 percent in March 2021.

Eastern Samar registered the highest increase in IR by 1.6 percentage points. Its IR rose to 4.9 percent in April 2021 from 3.3 percent in March 2021. Biliran grew by 1.3 percentage points, registering 4.9 percent IR during the month in review. Samar and Southern Leyte’s IRs registered increases of 0.2 percentage point to 0.1 percentage point, settling at 6.7 percent and 4.1 percent, respectively.

Samar recorded the highest IR among provinces in April 2021 at 6.7 percent, while Northern Samar posted the lowest at 0.7 percent.

BY COMMODITY GROUP

Majority of the 11 commodity groups in the region exhibited higher IRs in April 2021 compared with their rates in March 2021. However, these were offset by the lower IRs recorded in four (4) other commodity groups, which resulted to 0.1 percentage point decrease in the overall IR of the region in April 2021.

Transport commodity group registered the biggest increase in IR by 4.0 percentage points. Its 8.9 percent IR in March 2021 grew to a double-digit IR of 12.9 percent in April 2021. This acceleration can be traced to double-digit increase in the IR for operation of personal transport equipment (25.6%).

The commodity group for communication which registered a 1.4 percent deflation in March 2021 recorded price increase in April 2021 at 0.6 percent. This increase was brought about by the 2.8 percent IR in the index for telephone and telefax equipment in April 2021, from 23.8 percent deflation in March 2021.

Housing, water, electricity, gas and other fuels commodity group recorded 2.4 percent IR in April 2021; 1.0 percentage point higher than the 1.4 percent IR in March 2021. This growth can be attributed to the higher IRs in the index for electricity, gas, and other fuels (6.5%) and maintenance and repair of the dwelling (1.8%).

The IR for furnishings, household equipment, and routine maintenance of the house commodity group picked up by 0.7 percentage points, pushing its IR to 3.2 percent in April 2021.

Health commodity group registered 0.5 percentage point increase in its IR, from 1.1 percent in March 2021 to 1.6 percent in April 2021.

Compared with their March 2021 levels, IRs for restaurants and miscellaneous goods and services commodity group (3.6%) and education commodity group (0.5%) were higher by 0.2 percentage point and 0.1 percentage point, respectively, in April 2021.

On the other hand, IR for food and non-alcoholic beverages commodity group declined to 2.0 percent in April 2021 from 3.2 percent in March 2021. Lower IRs were noted in majority of the items under this commodity group. Vegetables index registered the highest decrease of 14.9 percentage points. Its IR dropped to 3.2 percent in April 2021 from its double-digit IR of 18.1 percent in March 2021. The IR for oils and fats index managed to shed off 4.0 percentage points from its 5.5 percent IR in March 2021, posting 1.5 percent IR in April 2021. The IR for fruits index also declined by 3.5 percentage points, settling at 2.9 percent during the month in review. Bread and cereals index further deflated to 1.5 percent while the rest of the items registered decreases ranging from 0.6 percentage point to 2.3 percentage points. Meanwhile, prices of meat picked up at a faster rate of 9.0 percent in April 2021 from 7.0 percent in March 2021. Faster annual price increases were also noted in indices for sugar, jam, honey, chocolate, and confectionary products (1.6%) and fish (5.3%). Rice continued to register deflation in April 2021 but at a slower rate of 2.2 percent.

The IR for clothing and footwear commodity group declined by 0.8 percentage points, settling at 1.8 percent in April 2021. The IR for the commodity group of alcoholic beverages and tobacco likewise eased by 0.1 percentage point, settling at 6.9 percent in April 2021.

Recreation and culture commodity group further deflated to 1.5 percent in April 2021 from 1.0 percent deflation in March 2021. 

PURCHASING POWER OF PESO

The Purchasing Power of Peso (PPP) of the region strengthened to Php 0.77 in April 2021. This PPP implies that the goods and services worth PhP 77.00 in 2012 is now worth PhP 100.00 in April 2021.

Compared to their levels in March 2021, PPP in Leyte strengthened by PhP 0.01, while PPP in Biliran and Eastern Samar weakened by PhP 0.01. The rest of the provinces retained their previous month’s PPP.

Leyte recorded the strongest PPP among provinces in April 2021 at PhP 0.80. Biliran and Southern Leyte ranked second at PhP 0.78, followed by Eastern Samar at PhP 0.73 and Northern Samar at PhP 0.72. Samar posted the weakest PPP during the reference month at PhP 0.70.

TECHNICAL NOTES

The current CPI series is 2012-based. The five steps involved in the rebasing/computing of the CPI are as follows: (1) identification of the base year (2) determination of the market basket (3) determination of household consumption patterns (4) monitoring of prices of items in the basket and (5) computation of CPI.

The 2012 FIES expenditure data were used to directly estimate the 2012 CPI weights at the national and regional levels. However, the 2012 FIES estimates for the expenditure data at the provincial level were not directly utilized in estimating the CPI expenditure weights as the data at the provincial/city level may not be reliable with the use of the households' master sample (MS) that was utilized in selecting the 2012 FIES sample households. The MS was drawn using regions as domains in generating estimates in all the household surveys of the PSA starting July 2003. The provincial/city expenditure data were derived using the model-based method in small area estimation procedures using the regional expenditure data as the control total for all the expenditure data within the specific region. Using these estimates, the weight for each item of expenditure is computed as a proportion of that item of expenditure to the total national expenditure. A raking procedure was done to adjust the weights of the provinces so that the provincial weights when added up will equal to the regional weights.

Based on PSA Board Resolution No. 02, Series of 2018, the new methodology for CPI uses straightforward computation of monthly average prices of commodities; chain method for elementary item indexes; geometric mean method at the lowest level (subclass level) of aggregation of price indexes; and weighted arithmetic mean at the higher levels of aggregation of price indexes.

BASE YEAR - is a period at which the index number is set to 100. It is the reference point of the index number series.

CONSUMER PRICE INDEX (CPI) - is an indicator of the change in the average prices of a fixed basket of goods and services commonly purchased by households relative to a base year.

DEFLATION - is the decline in prices for goods and services that happens when the inflation rate dips below 0%.

INFLATION RATE (IR) - is the annual rate of change or the year-on-year changes in CPI. It indicates how fast or how slow price changes over two time periods (year-on-year).  Contrary to common knowledge, low inflation does not necessarily connote that prices of commodities are falling.  It means that prices continue to increase but at a slower rate.

MARKET BASKET - refers to a sample of goods and services, which is meant to represent the totality of all the goods and services purchased by households relative to a base year.

MONITORING OF PRICES - involves establishing baseline information for the prices of the items in the base year and monitoring the prices of the items on a regular basis. Data collection for the CPI is done by the provincial office twice a month, except for petroleum products which are monitored on a weekly basis, every Friday. First collection phase is done during the first five days of the month while the second phase is on the 15th to 17th day of the month.

PURCHASING POWER OF PESO (PPP) - gives an indication of the real value of peso (how much it is worth) in a given period relative to its value in the base period. It is computed as the reciprocal of CPI multiplied by 100.

RETAIL PRICE - refers to the actual price at which retailers sell a commodity on spot or earliest delivery, usually in small quantities for consumption and not for resale.  It is confined to transactions on cash basis in the free market and excludes black-market prices and prices of commodities that are on sale as in summer sales, anniversary sales, Christmas sales, etc.

WEIGHTS - is a value attached to a commodity or group of commodities to indicate the relative importance of that commodity or group of commodities in the market basket. The weights for the 2012-based CPI were derived from the expenditure data of the 2012 Family Income and Expenditure Survey.

 

Sgd. WILMA A. PERANTE
Regional Director

 

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