Table A  Year-on-year and Month-on-Month Growth Rates of Producer Price Index:

 October  2012 and September  2012

•  Producer Price further exhibits a negative trend

Producer Price Index (PPI, 2000=100) for the manufacturing industry decreased  by 2.7 percent in October 2012 from negative 1.2 percent in September 2012, according to the preliminary results of the Monthly Producer Price Survey.  Furniture and fixtures with a decrease of 14.9 percent led the twelve major sectors which posted decrements in producer prices. On the other hand, increases in the PPI were observed in eight major sectors led by publishing and printing (6.1%). Refer to Tables 1 and A-1.

On a month-on-month performance, PPI also dropped by 0.9 percent in October 2012. This was due to the decline registered by heavily weighted sectors namely: chemical products (-2.9%), petroleum products (-2.2%), machinery except electrical (-1.8%) and electrical machinery (-1.1%). On the other hand, five sectors posted increases led by transport equipment (0.4%) while five major sectors posted flat growths.  Refer to Tables 1 and A-2

TABLE A-1   Producer Price Index, September 2012 – October 2012

                 (2000 =100)

TABLE A-2   Producer Price Index, October 2012 – September 2012

                      (2000 = 100)

             Note:                        

TECNICAL NOTES

•   Introduction

The National Statistics Office generates various price indices, one of these is the Producer Price Index (PPI). The PPI, a designated statistics, is generated through the results of the Producer Price Survey (PPS) conducted nationwide. The survey gathers monthly producer prices of selected products of establishments included in the market basket.

The PPI is used as a deflator of the Monthly Integrated Survey of Selected Industries (MISSI) to derive indicators for the Volume of Production Index (VoPI) and Volume of Net Sales (VoNSI).

•  Method of Index Computation

PPI utilizes the Paasche-type method of index computation. The weights are computed from the value of production to derive concentration ratios from the Census of Philippine Business and Industry (CPBI) or Annual Survey of Philippine Business and Industry (ASPBI). The weights are updated as soon as new results of the ASPBI or CPBI are available and applied at the beginning of each survey year.

For the 2012 PPI, the weights of the major sectors and sub-sectors were computed from the results of the 2009 ASPBI for Manufacturing Establishments with total employment of 20 and over, which is the latest survey results.

The formulas in the computation of the PPI are as follows:

•  Industry Coverage

The industry classification of the 2012 PPI utilizes the amended 1994 Philippine Standard Industry Classification. There are 20 major sectors covered by the 2012 PPS with three consisting of subsectors.

•  Response Rate

The response rate for October 2012 is 83.9 percent, which corresponds to the retrieval of 277 sample establishments’ reports.  Refer to Table 2.

Non-responding sample establishments are estimated using cold-deck imputation method. Revisions to the preliminary estimates are done upon receipt of actual reports from late respondents.

(Sgd) CARMELITA N. ERICTA
               Administrator