· The country’s year-on-year headline inflation rate continued to decelerate at 11.2 percent in October from 11.8 percent in September brought about by the continued slowing down in the annual price increases of the heavily weighted food, beverages and tobacco (FBT) and services items. Inflation a year ago was 2.7 percent.

· Likewise, annual inflation rate in the National Capital Region (NCR) further slowed down to 8.0 percent in October from 8.2 percent in September as the annual rates were slower in FBT and services index.

· The same trend was observed in the annual inflation rate in Areas Outside the National Capital Region (AONCR) as it eased to 12.6 percent in October from 13.5 percent in September. This was due to the slower annual price increases in FBT, fuel, light and water (FLW ) and services items.

• Excluding selected food and energy items, core inflation continued to go up at a rate of 7.8 percent in October from 7.5 percent in September.

• Decreases in the prices of food items such as rice, corn, pork and chicken along with the series of reductions in the prices of kerosene, gasoline and diesel pushed down the overall consumer prices by -0.4 percent in October, the same rate posted in September.

CONSUMER PRICE INDEX
(2000=100)
OCTOBER 2008

By Region, Year-on-Year

• The annual inflation rate in NCR slowed by 0.2 percentage point to 8.0 percent in October from 8.2 percent in September.

• In AONCR, annual inflation rate further eased to 12.6 percent in October from 13.5 percent in September as all the regions except for Zamboanga Peninsula recorded slower annual inflation rates. The biggest decline of 1.6 percentage points was in MIMAROPA (11.4% from 13.0%) and SOCCSKSARGEN (11.6% from 13.2%). The lowest annual rate was still registered in CALABARZON at 10.4 percent while the highest was in Eastern Visayas at 18.2 percent.

By Commodity Group, Year-on-Year

• Annual rates of price increases in FBT and services items correspondingly improved to 15.0 percent and 10.2 percent in October from their respective September rates of 16.1 percent and 12.1 percent. Annual inflation for the clothing index was however higher at 4.9 percent from 4.8 percent; housing and repairs (H&R) index, 5.3 percent from 5.2 percent; FLW index, 10.7 percent from 8.5 percent; and miscellaneous items index, 3.7 percent from 3.5 percent.

• The national annual inflation rate for food alone further decelerated to 15.6 percent in October from 17.0 percent in September.

• Annual price hike in rice was slower at 32.4 percent in October from 37.2 percent in September; corn, 26.3 percent from 26.8 percent; dairy products 13.4 percent from 14.2 percent; eggs, 5.5 percent from 6.1 percent; fruits and vegetables, 14.1 percent from 15.9 percent; meat, 10.1 percent from 11.0 percent; and miscellaneous foods, 9.1 percent from 9.3 percent. The corresponding annual rates of price increments in cereal preparations and fish at 20.3 percent and 10.1 percent were however higher than their respective last month’s rates of 20.0 percent and 10.0 percent.

• In NCR, the annual inflation rates for FBT and services index respectively slowed down to 10.1 percent and 10.0 percent in October from their corresponding September rates of 11.2 percent and 12.8 percent. On the other hand, annual inflation for clothing index moved up at a faster rate of 5.6 percent from 5.5 percent; H&R index, 3.4 percent from 3.2 percent; FLW index, 10.0 percent from 2.5 percent; and miscellaneous items index, 2.5 percent from 2.3 percent.

  • Inflation rate for food alone in NCR continued to move slowly at 10.4 percent in October from 11.6 percent in September.

  • A negative annual rate of price adjustment was still noticed in the eggs index at -3.2 percent in October from -3.7 percent in September. Moreover, annual price gain in rice further slipped to 30.3 percent from 33.3 percent; cereal preparations, 20.3 percent from 20.5 percent; dairy products, 12.1 percent from 12.7 percent; fish, 4.8 percent from 6.1 percent; fruits and vegetables, 8.9 percent from 11.3 percent; and meat, 6.6 percent from 9.1 percent. On the contrary, corn and miscellaneous foods posted higher annual prices increases at 3.7 percent and 6.4 percent, respectively from their corresponding last month’s rates of 3.6 percent and 6.3 percent

• In AONCR, annual inflation rate for FBT index continued to decelerate at 16.5 percent in October from 17.7 percent and FLW and services index, 11.2 percent and 10.4 percent from 11.7 percent. Annual inflation for clothing and miscellaneous items index were correspondingly higher at 4.8 percent and 4.0 percent from 4.6 percent and 3.9 percent, respectively while H&R index moved at its last month’s rate of 6.7 percent.

  • Annual inflation for food alone in AONCR further moved at a slower rate of 17.3 percent in October from 18.7 percent in September.

  • On an annual basis, price hike in rice eased to 32.8 percent in October from 37.7 percent in September as all the regions registered slower annual rates except for Zamboanga Peninsula and ARMM. The biggest decline of 8.4 percentage points (27.6% from 36.0%) was observed in Bicol.

  • Annual price increment in corn slid to 26.7 percent in October from 27.2 percent in September; dairy products, 13.9 percent from 14.8 percent; eggs, 8.4 percent from 9.4 percent; fruits and vegetables, 15.8 percent from 17.3 percent; meat, 11.6 percent from 12.0 percent; and miscellaneous foods, 10.3 percent from 10.7 percent.

  • On the contrary, higher annual price gains were correspondingly noticed in cereal preparations and fish at 20.2 percent and 11.2 percent from 19.7 percent and 10.9 percent, respectively.

By Region, Month-on-Month

• In general, prices in NCR continued to decrease as a negative 0.3 percent growth was recorded in October. This was effected by lower prices of FBT and services items as their growth rates correspondingly went down by -0.5 percent and -1.9 percent from 0.1 percent and -2.3 percent, respectively. On the other hand, price increments in FLW and miscellaneous items were higher at 2.4 percent and 0.2 percent, respectively from their corresponding last month’s rates of -0.8 percent and zero growth. Prices of clothing and H&R items moved up at 0.1 percent, the same rate noted last month.

• Compared with September, consumer prices in AONCR further dropped to -0.4 percent in October from -0.3 percent. Negative rates were still posted in the prices of FBT items at -0.5 percent from -0.2 percent; FLW items, -0.5 percent from -1.6 percent; and services items, -0.9 percent from -0.5 percent. In addition, price gain in clothing items was slower at 0.2 percent from 0.4 percent and H&R and miscellaneous items, 0.2 percent from 0.3 percent.

• Downward price adjustments in the consumer prices were observed in all the regions except for CALABARZON. The lowest rate of -1.4 percent was still registered in Caraga while the fastest monthly growth rate of -0.1 percent was noticed in Zamboanga Peninsula.

• Among the three big areas of the country, the Mindanao area showed bigger price decreases compared to Luzon and Visayas areas.

By Commodity Group, Month-on-Month

• On a monthly basis, consumer prices at the national level dropped by -0.4 percent in October, the same rate posted September. This was brought about by the continued decreases in the prices of FBT items at -0.4 percent from -0.2 percent and services items, -1.2 percent, the same rate in September. Slower monthly price increments correspondingly observed in clothing and H&R items at 0.2 percent and 0.1 percent from their respective last month’s rates of 0.3 percent and 0.2 percent also contributed to the downtrend. Price add-ons in FLW items were however higher at 0.5 percent from -1.4 percent while that for miscellaneous items remained at 0.2 percent.

• The harvest season of palay continued to bring sufficient supply of rice in the markets nationwide. Thus, the rice index in the Philippines recorded declines of -3.1 percent from -2.7 percent; NCR, -2.3 percent from -3.0 percent; and AONCR, -3.2 percent from -2.7 percent. SOCCSKSARGEN registered the biggest drop in the rice index of -6.9 percent while Ilocos showed the least rate of -1.1 percent.

• The continued increase in the supply of corn pulled down its prices in the Philippines and AONCR by -2.0 percent. Meanwhile, the price of corn in NCR appeared stable as the group’s index in the area posted a zero growth from 0.1 percent.

• Lower farm prices of hogs continued to bring down prices of pork in the markets nationwide. Sufficient supply of chicken also pushed down its prices during the month. Declines in the prices of uncanned preserved meat in selected regions were also observed. All these factors contributed to the downward trend in the meat index in the three areas during the month: Philippines, -0.8 percent from -0.3 percent; NCR, -2.3 percent from -0.7 percent; and AONCR, -0.2 percent from -0.1 percent.

• The difficulty in catching fish species brought about by the rainy season resulted to less supply in the wet markets, thus, raising the fish index in the Philippines and AONCR by 1.0 percent and 1.1 percent, respectively from 0.7 percent. In NCR, upward adjustments in the prices of selected fresh species were almost offsetted by the reductions in the prices of shrimps and crabs in the area. Hence, the aggregate index of fish in the area moved up slightly by 0.1 percent from 0.9 percent.

• The favorable weather condition for the production of vegetables resulted to heavy inflow in the markets generating a downward pull in the prices of vegetables. Fresh food markets were also abundantly supplied with locally grown and imported fruits. These supply situations improved the price trends of fruits and vegetables in the three areas: Philippines, 0.5 percent from 1.7 percent; NCR, 1.2 percent from 1.6 percent; and AONCR, 0.3 percent from 1.8 percent.

• The index of cereal preparations rose by 0.7 percent in the Philippines; 0.5 percent in NCR; and 0.8 percent in AONCR due to the additions in the prices of flour and flour products. However, these increments were slower than their corresponding previous month’s growth rates of 1.1 percent, 0.7 percent and 1.3 percent.

• The continuous rollbacks in the prices of gasoline and diesel in the global markets also bring down their prices domestically. Hence, the services index in the Philippines dropped by -1.2 percent; NCR, -1.9 percent; and AONCR, -0.9 percent.

• With higher electricity rates recorded in NCR, the FLW index in the area and in the Philippines grew by 2.4 percent and 0.5 percent, respectively from their corresponding last month’s rates of -0.8 percent and -1.4 percent. Meanwhile, the FLW index in AONCR fell by -0.5 percent due to the decreases in the prices of LPG and kerosene despite higher electricity and water rates registered in many regions.

• Upward adjustments in the prices of selected construction materials slightly pulled up the H&R index in the Philippines and NCR by 0.1 percent and in AONCR, 0.2 percent.

NOTES:

1. Inflation rates for September were revised to reflect the correct prices of selected items.

2. CPIs and inflation rates by province and selected city are also available upon request at NSO, Industry and Trade Statistics Department, Economic Indices and Indicators Division (Telephone Numbers: 716-39-35 and 715-33-47).

Source: National Statistics Office
Manila, Philippines