Tacloban City’s inflation rate climbs at 4.3 percent in February 2023

      Tacloban City’s inflation rate increased by 0.6 percentage point, from 3.7 percent in January 2023 to 4.3 percent in February 2023. Tacloban City’s inflation rate during the same period last year was lower at 3.6 percent. The gap between Tacloban City and Leyte’s inflation rate has narrowed after this increase. Along with Tacloban City, the province of Eastern Samar also posted an increase in its inflation rate.

      The upward trend in Tacloban City’s inflation rate during the reference period was due to the increase in the inflation rate of six (6) major commodity groups. Inflation rate of Food and Non-alcoholic Beverages went up to 8.4 percent in February 2023 from 6.5 percent in January 2023 which was due to the faster rate of increase in prices of almost all the sub commodity groups except Meat and Other Parts of Slaughtered Land Animals, Water, and Other Non-alcoholic Beverages. Alcoholic Beverages and Tobacco also registered an increase in its inflation rate at 5.7 percent in February 2023, from 5.4 percent in January 2023 due to the faster rate of increase in prices of Spirits and Liquors, Beer, and Tobacco. Housing, Water, Electricity, Gas and Other Fuels posted an inflation of 0.2 percent in February 2023 from a deflation of 1.0 percent in January 2023 due to the faster rate of increase in prices of Gas and the slower rate of decrease in prices of Electricity. Recreation, Sport and Culture posted a 0.1 percentage point increase in its inflation rate at 1.8 percent in February 2023 from 1.7 percent in January 2023 caused by the faster rate of increase in prices of Pets and Products for Pets and Stationery and Drawing Materials. Further, a 0.2 percentage point increase was recorded in Health (1.3 percent to 1.5 percent) and Personal Care, and Miscellaneous Goods and Services (2.7 percent to 2.9 percent). The former was due to the faster rate of increase in prices of Medicines, Medical Products, and Diagnostic Imaging Services and Medical Laboratory Services. While the latter was caused by the faster rate of increase in prices of Other Appliances, Articles and Products for Personal Care and Hairdressing Salons and Personal Grooming Establishments.

      Meanwhile, Furnishings, Household Equipment and Routine Household Maintenance posted deflation of 0.4 percent in February 2023 from a deflation of 0.9 percent in January 2023 due to the faster rate of increase in prices of Furniture, Furnishings and Loose Carpets, Major Household Appliances, Whether Electric or Not, Small Household Appliances, Glassware, Tableware, and Household Utensils, Non-motorized Tools and Miscellaneous Accessories, and the slower rate of decrease in prices of Non-durable Household Goods. 

      On the other hand, Transport posted a 3.2 percentage points decrease in its inflation rate at 4.6 percent in February 2023 from 7.8 percent in January 2023 due to the slower rate of increase in prices of Fuels and Lubricants for Personal Transport Equipment and Passenger Transport by Air.

      Meanwhile, five (5) major commodity groups maintained their inflation rates from their previous months’ rate. These are Clothing and Footwear with 0.2 percent; Information and Communication also with 0.2 percent, Education Services with 1.0 percent; Restaurants and Accommodation Services with 2.6 percent; and Financial Services with zero percent inflation rate. 

      The inflation rate is the general rise in prices over a period. It indicates how fast or how slow price changes over two-time periods. Contrary to common knowledge, low inflation does not necessarily connote that prices are falling instead; it means that prices continue to increase at a slower rate. It is a derived indicator of the Consumer Price Index (CPI).

      The CPI is a measure of change in the average retail prices of goods and services commonly purchased by a particular group of people in a specific area. The overall CPI in Tacloban City for February 2023 was 117.0. This implies that the average retail price of goods and services in Tacloban City is 17.0 percent higher than the average retail prices in 2018 (base year).

Purchasing Power of Peso (PPP) decreases at 85 centavos in February 2023

      The Purchasing Power of Peso (PPP) in Tacloban City decreased at 85 centavos in February 2023 from 86 centavos in January 2023. Meanwhile, the PPP in Leyte also decreased at 83 centavos during the reference month from 84 centavos in January 2023. The 85 centavos purchasing power of peso in Tacloban City indicates that the same basket of goods and services worth 85 pesos in 2018 (base year) is worth 100 pesos during the reference period.

TECHNICAL NOTES 

Rebasing of the CPI is necessary to ensure that this barometer of economic phenomena is truly reflective of current situation. Consumer taste, fashion and technology change over time causing the fixed market basket of goods and services to become outmoded. To capture such changes for a more meaningful price comparison, revision or updating of the fixed market basket, the sample outlets, the weights and the base year had to be done periodically. 

BASE PERIOD – refers to the reference period of the index number. It is a period at which the index is set to 100. Current base period is 2018. 

MARKET BASKET - refers to a sample of goods and services used to represent all goods and services bought by a particular group of consumers in a particular area. 

WEIGHTS - The weights for the 2018-based CPI were derived from the expenditure data of the 2018 Family Income and Expenditure Survey (FIES). The weight for each item of expenditure is a proportion of that expenditure item to the total national expenditure. The total (all items) national expenditure weights is equal to 100. 

MONITORING OF PRICES - is to establish baseline information for prices of the items in the base year and monitoring of the prices of the items on a regular basis. Except for Food, Beverage and Tobacco which is monitored on a weekly basis in NCR, price collection is done twice a month. First collection phase is done during the fir st five days of the month while the second phase is on the 15th to 17th day of the month. 

COMPUTING THE CPI - The formula used in computing the CPI is the weighted arithmetic mean of price relatives, a variant of the Laspeyres formula with fixed base year period weights. 

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.

CONSUMER PRICE INDEX – is a measure of change in the average retail prices of goods and services commonly purchased by a particular group of people in a particular area. 

INFLATION RATE – refers to the annual rate of change or year-on-year change in CPI.

PURCHASING POWER PESO – it is a measure of how much the peso in the base period is worth in another period. It gives as indication of the real value in a given period relative to the peso value in the base period.

SGD. SHERYL ANN A JAMISOLA
Chief Statistical Specialist