· The year-on-year headline inflation rate at the national level further jumped to 9.6 percent in May from 8.3 percent in April, the highest inflation since January 1999 (10.5%). This was primarily triggered by the continuing higher annual price increases in the heavily-weighted food, beverages and tobacco (FBT) index. The rest of the commodity groups also posted higher inflation rates during the month. Inflation a year ago was 2.4 percent.

· Likewise, annual inflation rate in the National Capital Region (NCR) accelerated by 0.9 percentage point, to 8.3 percent in May from 7.4 percent in April due to higher annual price adjustments in FBT, services and miscellaneous index

· In Areas Outside the National Capital Region (AONCR), annual inflation rose to 10.2 percent in May from 8.7 percent in April. All the commodity groups registered higher annual inflation rates except the miscellaneous items index.

• Excluding selected food and energy items, core inflation advanced to 6.2 percent in May from 5.9 percent in April.

• Price hikes in many food items were still noted with the month-on-month inflation rate in the Philippines recorded at 1.5 percent in May. It decelerated by 0.5 percentage point from 2.0 percent in April. Moreover, price increases in the rest of the commodity groups except for services items also improved during the month.

CONSUMER PRICE INDEX
(2000=100)
MAY 2008

By Region, Year-on-Year

• The annual inflation rate in NCR jumped to 8.3 percent in May from 7.4 percent in April.
• Annual inflation rates in all the regions were higher during the month than in April. Thus, inflation in AONCR posted a double-digit figure of 10.2 percent in May from 8.7 percent last month. The biggest acceleration of 4.9 percentage points was observed in Zamboanga Peninsula (13.5% from 8.6%) followed by Autonomous Region in Muslim Mindanao (ARMM) (12.4% from 8.9%) at 3.5 percentage points. The highest inflation rate among the regions was seen in Zamboanga Peninsula at 13.5 percent.

By Commodity Group, Year-on-Year

• At the national level, higher annual inflation rates continued to prevail in all the commodity groups. Inflation for FBT advanced to 13.7 percent in May from 11.4 percent in April; clothing, 4.0 percent from 3.9 percent; H&R, 4.0 percent from 3.8 percent; FLW, 8.2 percent from 8.0 percent; services, 7.8 percent from 6.9 percent; and miscellaneous items, 2.7 percent from 2.6 percent.
• The Philippines’ annual inflation rate for food alone was up to 14.3 percent in May from 12.0 percent in April.
• All the food groups posted higher annual price uptick except for eggs whose rate was slower at 7.7 percent from 8.4 percent. Annual price adjustments were higher in rice at 31.7 percent in May from 24.6 percent in April; corn, 27.1 percent from 19.3 percent; cereal preparations, 15.3 percent from 13.9 percent; dairy products, 13.7 percent from 13.2 percent; fish, 9.6 percent from 8.8 percent; fruits and vegetables, 10.1 percent from 7.8 percent; meat, 10.4 percent from 9.8 percent; and miscellaneous foods, 7.6 percent from 6.3 percent.
• In NCR, inflation rate for FBT rose to 12.7 percent in May from 11.1 percent in April; services, 9.9 percent from 8.5 percent; and miscellaneous items, 1.7 percent from 1.6 percent. On the other hand, annual rates of price hikes in H&R items decelerated to 2.3 percent from 2.5 percent while those for clothing and FLW items correspondingly remained at their previous month’s rates of 5.2 percent and 6.6 percent.
  • Inflation rate for food alone in NCR grew by 13.2 percent in May from 11.5 percent in April.
  • Higher annual price increase was noticed in rice at 43.6 percent in May from 38.4 percent in April; cereal preparations, 15.7 percent from 14.3 percent; dairy products, 11.8 percent from 11.3 percent; fish, 12.7 percent from 12.0 percent; fruits and vegetables, 10.5 percent from 3.5 percent; and miscellaneous foods, 6.9 percent from 5.4 percent. Slower annual price changes were however registered in eggs and meat at 3.3 percent and 10.5 percent, respectively from their corresponding last month’s rates of 5.8 percent and 11.5 percent. For five consecutive months, inflation for corn remained at 17.5 percent.
• In AONCR, annual inflation in all the commodity groups continued to move at higher rates except for miscellaneous items whose annual growth rate slid to 3.0 percent from 2.9 percent. Inflation for FBT picked up to 14.1 percent in May from 11.5 percent; clothing, 3.6 percent from 3.4 percent; H&R, 5.3 percent from 4.9 percent; FLW, 9.1 percent from 8.8 percent; and services, 6.6 percent from 5.9 percent.
  • Annual price hikes for food alone jumped to 14.7 percent in May from 12.1 percent in April.
  • Annual price changes in rice posted in all the regions moved further higher during the month. Inflation rate for rice in AONCR accelerated to 30.1 percent in May from 22.7 percent in April. The biggest gain of 23.6 percentage points (33.0% from 9.4%) was seen in Zamboanga Peninsula followed by ARMM at 18.7 percentage points (32.6% from 13.9%).
  • The annual growth rates were also higher in corn at 27.4 percent in May from 19.3 percent in April; cereal preparations, 15.1 percent from 13.8 percent; dairy products, 14.5 percent from 14.1 percent; fish, 9.0 percent from 8.1 percent; fruits and vegetables, 10.0 percent from 9.0 percent; meat, 10.4 percent from 9.1 percent; and miscellaneous foods, 7.9 percent from 6.7 percent. Meanwhile, annual inflation for eggs was slower at 9.0 percent from 9.3 percent.

By Region, Month-on-Month

• Prices in NCR increased at a slower rate of 1.1 percent in May from 2.1 percent in April. Lower price hikes in FBT items were recorded at 1.7 percent in May from 2.5 percent in April; FLW items, 0.3 percent from 5.0 percent; and miscellaneous items, 0.2 percent from 0.6 percent. Upward adjustments in the prices of services items were however higher at 2.0 percent from 1.2 percent while H&R items posted zero growth during the month. Price mark-ups in clothing items remained at 0.1 percent.
• The 1.7 percent gain in consumer prices in AONCR in May was slower compared to its last month’s rate of 2.0 percent. This was primarily due to the 1.0 percentage point slowdown in the price add-ons in FBT items at 2.5 percent from 3.5 percent. Moreover, price hikes in clothing items slid to 0.3 percent from 0.5 percent. Price additions in H&R items were however higher at 0.4 percent from 0.1 percent; FLW items, 1.0 percent from 0.2 percent; and services items, 1.0 percent from 0.7 percent. Price uptick in miscellaneous items was still at 0.2 percent.
• Nine regions posted slower month-on-month inflation rates with Central Visayas registering the biggest slowdown of 2.1 percentage points (1.2% from 3.3%). The lowest rate was also seen in Central Visayas at 1.2 percent while Zamboanga Peninsula recorded the highest rate of 4.6 percent.
• Price movements in Mindanao regions were generally higher that those of Luzon and Visayas. Price hikes in Visayas were slowest compared to the two island groups.

By Commodity Group, Month-on-Month

• The slowdown in price increments of all the commodity groups except for services items caused the overall month-on-month inflation rate to decelerate at 1.5 percent in May from 2.0 percent in April. Price hikes in FBT items slowed to 2.3 percent in May from 3.2 percent in April; clothing and miscellaneous items, 0.2 percent from 0.4 percent and 0.3 percent, respectively; H&R items, 0.3 percent from 0.7 percent; and FLW items, 0.7 percent from 1.8 percent. On the contrary, price mark-ups in services items were higher at 1.3 percent from 0.9 percent.
• Slower price increments in rice posted in all the regions in Luzon and Visayas including the two regions located in Mindanao area resulted to a lower price gain in the Philippines at 6.2 percent in May from 12.9 percent in April; NCR, 3.9 percent from 15.6 percent; and AONCR, 6.5 percent from 12.5 percent. The lowest monthly growth rate of 2.6 percent was in Eastern Visayas while the highest rate was noted in Zamboanga Peninsula at 21.9 percent.
• The monthly growth rate in the fruits and vegetables index in the Philippines was seen at 2.8 percent in May from -2.4 percent in April; NCR, 8.0 percent from -1.9 percent; and AONCR, 1.4 percent from -2.5 percent due to the effects of typhoon “Cosme” on agricultural crops in selected regions.
• Higher prices of selected spices and seasonings including powdered tonic drink in NCR raised the miscellaneous foods index in the area by 1.4 percent from 0.9 percent. On the other hand, these price increments were slower in AONCR and in the Philippines at 1.3 percent from their corresponding last month’s rates of 1.7 percent and 1.5 percent.
• The low supply of pork and beef and higher demand for chicken pushed up prices of fresh meat in the three areas. However, from the 2.6 percent growth rate posted last month in the meat index, the rate in the Philippines eased to 1.4 percent; NCR, 0.6 percent; and AONCR, 1.7 percent.
• Prices of corn further moved upward in seven regions as higher prices of inputs for its production were still observed during the month. The corn index in AONCR and in the Philippines registered growth rates of 7.5 percent and 7.3 percent, respectively. These were however slower than their respective last month’s double-digit figures of 11.3 percent and 11.1 percent. For four consecutive months, prices of corn in NCR remained stable as its index continued to record a zero growth.
• The rising prices of flour and flour products pulled up the index of cereal preparations in the Philippines and AONCR by 1.6 percent and NCR, 1.3 percent. These were however lower than their respective last month’s rates of 2.5 percent, 2.6 percent and 2.1 percent.
• The index of dairy products in the three areas inched up by 0.6 percent in the three areas as prices of milk and milk products were still higher during the month. These were however slower than the previous month’s gain of 1.1 percent in the Philippines and AONCR and 1.0 percent in NCR.
• A 0.5 percent increase noted in the prices of fish in AONCR was attributed to the low supply of fish due to the lesser fishing trips brought about by the inclement weather condition that generally prevailed during the month. At the national level, the fish index registered a growth of 0.1 percent, slower than its previous month’s rate of 0.8 percent. However, prices of fish in NCR dropped by -1.3 percent from 1.8 percent due to sufficient supply of marine and cultured fish species such as bangus and tilapia in the markets coming from the nearby provinces.
• The services index in the Philippines further gained by 1.3 percent in May from 0.9 percent in April; NCR, 2.0 percent from 1.2 percent; and AONCR, 1.0 percent from 0.7 percent mainly due to the series of price increments in gasoline and diesel. Price add-ons in selected school supplies, textbooks and medicines also contributed to the uptrend.
• With the continued increases in the prices of kerosene and LPG nationwide, the FLW index in NCR and AONCR went up by 0.3 percent and 1.0 percent, respectively. The national index moved upward by 0.7 percent.
• Uptick in the prices of selected construction materials raised the H&R index by 0.4 percent in AONCR and 0.3 percent in the Philippines. In NCR, prices of H&R items generally remained stable during the month as its group’s index registered a zero growth from 1.5 percent.

NOTE: 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