Inflation Rate in Eastern Visayas Increases to 3.5% in August 2021

Reference Number: 

SR-202109-0800-30

Release Date: 

Thursday, September 30, 2021

Inflation Rate (IR) in Eastern Visayas increased to 3.5 percent in August 2021, the highest in the region of the last 12 months. This IR is 0.3 percentage point higher compared with the 3.2 percent IR in July 2021. This August IR of the region is also 1.2 percentage points higher than the recorded 2.3 percent IR in the same period last year.

In comparison with the national average IR, the regional IR is still lower by 1.4 percentage points than the 4.9 percent national IR in August 2021.

Eastern Visayas’ IR of 3.5 percent ranked third lowest among the regions in August 2021. BARMM registered the lowest IR at 2.5 percent, followed by Central Visayas at 3.1 percent.
 
On the other hand, Cagayan Valley posted the highest IR at 7.5 percent, closely followed by Bicol Region at 7.4 percent. Davao Region registered the third highest IR among the regions in August 2021 at 6.7 percent.
 
BY PROVINCE
 
Among the provinces, Eastern Samar posted the highest IR at 6.3 percent in August 2021. Samar’s IR came next at 6.0 percent, then Biliran at 5.4 percent. The lowest IR was noted in Leyte at 2.2 percent.
 
 
Biliran, Northern Samar, Leyte, and Eastern Samar registered higher IRs in August 2021 compared with their figures in July 2021. Biliran and Northern Samar recorded the highest increase in IR both at 0.9 percentage point. Biliran grew to 5.4 percent in August 2021 from 4.5 percent in July 2021. Northern Samar went up to 2.4 percent in August 2021 from 1.5 percent in July 2021. Leyte’s IR increased to 2.2 percent in August 2021, recording 0.5 percentage point growth from its 1.7 percent IR in July 2021. IR in Eastern Samar inched up by 0.2 percentage point pushing its IR to 6.3 percent in August 2021.
 
On the other hand, the provinces of Samar and Southern Leyte recorded decreases in their IRs in August 2021 by 0.9 percentage point and 0.1 percentage point, respectively. Samar declined to 6.0 percent in August 2021 from 6.9 percent in July 2021. Southern Leyte eased to 2.8 percent in August 2021 from 2.9 percent in July 2021.

BY COMMODITY GROUP

Transport commodity group continued to post the highest IR at 9.3 percent. This was followed with the IR of alcoholic beverages and tobacco commodity group (7.1%), and housing, water, electricity, gas and other fuels commodity group (5.1%). All the other commodity groups have IR lower than the IR for all items recorded at 3.5 percent.

Majority of the 11 commodity groups in the region exhibited lower IRs in August 2021 compared with their rates in July 2021. However, these were offset by the increases noted in the IRs of three (3) commodity groups in August 2021, namely: recreation and culture (3.3 percentage points); housing, water, electricity, gas, and other fuels (1.5 percentage points); and food and non-alcoholic beverages (0.7 percentage point). This resulted to 0.3 percentage point increase in the overall IR of the region in August 2021.
 
The transport commodity group and furnishings, household equipment, and routine maintenance of the house commodity group both registered the biggest decrease in IR by 1.0 percentage point. Transport commodity group settled at 9.3 percent in August from its double-digit IR of 10.3 percent in July 2021, while IR for furnishings, household equipment, and routine maintenance of the house commodity group declined to 1.4 percent in August 2021 from 2.4 percent in July 2021.
 
The IRs for the restaurants and miscellaneous goods and services commodity group and health commodity group both managed to shed off 0.8 percentage point from their IRs in July 2021 registering 1.7 percent and 1.2 percent IRs, respectively, in August 2021.
 
Compared with their July 2021 levels, IRs for clothing and footwear commodity group (1.7%) and alcoholic beverages commodity group (7.1%) were lower by 0.5 percentage point and 0.2 percentage point, respectively in August 2021.
 
Communication commodity group’s IR eased by 0.1 percentage point settling at 0.9 percent in August 2021.
 
On the other hand, housing, water, electricity, gas and other fuels commodity group recorded 5.1 percent IR in August 2021, higher by 1.5 percentage points from its 3.6 percent IR in July 2021. This growth can be attributed to higher IR in the indices for electricity, gas, and other fuels (15.1%) and water supply and miscellaneous services relating to the dwelling (0.9%).
 
Food and non-alcoholic beverages commodity group registered a 0.7 percentage point increase in IR, from 2.6 percent in July 2021 to 3.3 percent in August 2021. Lower IRs and deflations were noted in majority of the items under this commodity group. Fruits index registered the highest decrease of 0.9 percentage point, from 2.6 percent IR in July 2021 to 1.7 percent IR in August 2021. The IR for non-alcoholic beverages declined by 0.4 percentage point from its 0.6 percent IR in July 2021, posting 0.2 percent IR in August 2021. Slower price increases were also noted in the indices for food products not elsewhere classified (2.8%) and oils and fats (1.9%). Corn, rice, and bread and cereals further deflated to 1.7 percent, 1.6 percent, and 1.2 percent, respectively in August 2021. However, these decreases were offset by the increases registered in four (4) food items. Vegetables index registered the highest increase in IR at 3.0 percentage points, from 1.6 percent in July 2021 to 4.6 percent in August 2021. IR for fish index registered 2.6 percentage points increase posting a double-digit IR of 10.1 percent in August 2021. Meat index continued to register double-digit IR at 11.6 percent in August 2021, higher by 1.3 percentage points from its 10.3 percent IR in July 2021. Higher price increases were also noted in the index for sugar, jam, honey, chocolate, and confectionery at 2.0 percent. Milk, cheese, and eggs retained its previous month’s IR at 1.3 percent.
 
The IR of recreation and culture commodity group escalated by 3.3 percentage points. Its 1.6 percent deflation in July 2021 went up to 1.7 percent IR in August 2021. This can be traced to the rebound in the IR of recreation and cultural services index from a double-digit deflation (11.9%) in July 2021 to a zero IR in August 2021.
 
The commodity group of education, meanwhile, 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 August 2021. This PPP implies that the goods and services worth PhP 76.00 in 2012 is now worth PhP 100.00 in August 2021.
 
Compared with their levels in July 2021, PPP in Biliran and Northern Samar weakened by PhP 0.01. The rest of the provinces retained their previous month’s PPP.
 
Biliran and Leyte recorded the strongest PPP among provinces in August 2021 at PhP 0.79. Southern Leyte ranked second at PhP 0.78, followed by 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.
 
 
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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