Friday, July 23, 2021
Inflation Rate (IR) in Eastern Visayas escalated further to 3.3 percent in June 2021. This IR is 0.2 percentage point higher compared with the 3.1 percent IR in May 2021. This June IR of the region is also 2.2 percentage points higher than the recorded 1.1 percent IR in the same period last year.
In comparison with the national average IR, the regional IR is 0.8 percentage point lower than the 4.1 percent national IR in June 2021.
Eastern Visayas’ IR of 3.3 percent ranked fourth lowest among the regions in June 2021. Central Visayas registered the lowest IR at 1.7 percent, followed by BARMM and NCR at 2.1 percent and 3.2 percent, respectively.
On the other hand, Bicol posted the highest IR at 6.3 percent, closely followed by Cagayan Valley at 6.2 percent. CALABARZON registered the third highest IR among the regions in June 2021 at 5.4 percent.
Among the provinces, Samar posted the highest IR at 7.8 percent in June 2021. Eastern Samar’s IR came next at 6.5 percent, then Biliran at 4.4 percent. The lowest IR was noted in Leyte at 1.3 percent.
Northern Samar, Eastern Samar, and Leyte registered higher IRs in June 2021 compared with their figures in May 2021. Northern Samar recorded the highest increase in IR at 1.5 percentage points, pushing its IR to 3.1 percent in June 2021 from 1.6 percent in May 2021. Eastern Samar’s IR rose to 6.5 percent in June 2021, recording 1.1 percentage points increase from its 5.4 percent IR in May 2021. Leyte grew by 0.4 percentage point registering 1.3 percent IR in June 2021.
On the other hand, the provinces of Biliran, Samar, and Southern Leyte managed to lower their IRs in June by 1.1 percentage points, 0.5 percentage point, and 0.3 percentage point, respectively. Biliran declined to 4.4 percent in June 2021 from 5.5 percent in May 2021. Samar eased down to 7.8 percent in June 2021 from 8.3 percent in May 2021. Southern Leyte’s IR, meanwhile, settled at 3.0 percent in June 2021, 0.3 percentage point lower compared with its 3.3 percent IR in May 2021.
BY COMMODITY GROUP
Transport commodity group continued to post the highest IR at 11.5 percent. The 6.8 percent IR of alcoholic beverages and tobacco commodity group followed. All the other commodity groups have IR equal or lower than the IR for all items recorded at 3.3 percent.
Majority of the 11 commodity groups in the region exhibited higher IRs in June 2021 compared with their rates in May 2021. Food and non-alcoholic beverages commodity group registered the biggest increase in IR by 0.6 percentage point, from 2.2 percent in May 2021 to 2.8 percent in June 2021. Higher IRs were noted in majority of the items under this commodity group. Fish index registered the highest increase of 2.7 percentage points, from 6.4 percent IR in May 2021 to 9.1 percent IR in June 2021. The IR for vegetables index grew by 1.6 percentage points from its 0.3 percent IR in May 2021, posting 1.9 percent IR in June 2021. Prices of meat picked up at a faster rate of 9.6 percent in June 2021 from 8.9 percent in May 2021. Faster price increases were also noted in indices for food products not elsewhere classified (4.1%); sugar, jam, honey, chocolate and confectionery (1.9%); oils and fats (1.8%); and non-alcoholic beverages (0.6%) during the month in review. Corn and fruits continued to register deflations in June 2021 but at a slower rate of 1.3 percent and 0.8 percent, respectively. Meanwhile, IR for milk, cheese, and eggs eased to 2.0 percent in June 2021 from 2.2 percent in May 2021. Rice and bread and cereals further deflated to 1.3 percent and 0.8 percent, respectively.
Communication commodity group recorded 1.0 percent IR in June 2021, higher by 0.3 percentage point from the 0.7 percent IR in May 2021. This growth can be attributed to higher IR in the index for telephone and telefax services (0.9%).
The IRs for housing, water, electricity, gas, and other fuels commodity group and health commodity group picked up by 0.2 percentage points, pushing their IRs to 3.3 percent and 1.8 percent, respectively in June 2021.
Compared with their May 2021 levels, IRs for restaurants and miscellaneous goods and services commodity group (2.9%) and clothing and footwear commodity group (2.1%) were both higher by 0.1 percentage point in June 2021.
On the other hand, transport commodity group managed to shed off by 2.2 percentage points from its 13.7 percent IR in May 2021. It still, however, registered a double-digit IR of 11.5 percent in June 2021.
IR for furnishings, household equipment, and routine maintenance of the house commodity group recorded 0.3 percentage point decrease, from 3.2 percent in May 2021 to 2.9 percent in June 2021. IR for alcoholic beverages and tobacco likewise eased by 0.1 percentage point, settling at 6.8 percent in June 2021.
Recreation and culture commodity group further deflated to 1.5 percent in June 2021. While education commodity group retained its previous month’s IR at 0.5 percent.
PURCHASING POWER OF PESO
The Purchasing Power of Peso (PPP) of the region remained at Php 0.76 in June 2021. This PPP implies that the goods and services worth PhP 76.00 in 2012 is now worth PhP 100.00 in June 2021.
All provinces retained their previous month’s PPP. Leyte recorded the strongest PPP among provinces in June 2021 at PhP 0.80. Biliran ranked second at PhP 0.79, followed by Southern Leyte at PhP 0.78, Eastern Samar at PhP 0.73, and Northern Samar at PhP 0.71. Samar posted the weakest PPP during the reference month at PhP 0.69.
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