National annual average inflation slowed down

The annual average consumer price index (CPI) in 2009 was recorded at 160.0 for the Philippines, 156.9 for the National Capital Region (NCR) and 161.3 for areas outside NCR (AONCR).

The country’s annual average inflation rate decelerated by 6.1 percentage points to 3.2 percent in 2009 from 9.3 percent in 2008 as all the commodity groups posted either slower or negative annual average rates. The lowest annual average inflation during the year was observed in August at 0.1 percent while the highest was in February at 7.3 percent.

Regional inflation also slowed down

The annual average inflation rate in NCR eased to 1.6 percent in 2009 from 6.9 percent in 2008. This was the lowest annual average inflation in the area in 34 years.

Likewise, the annual average inflation in AONCR slipped to 3.9 percent in 2009 from 10.4 percent in 2008 as all the regions posted slower annual price increments during the year.

Among the regions in AONCR, the lowest annual average inflation rate during the year was noted in Region VII (Central Visayas) at 2.7 percent followed by Region IV-B (MIMAROPA) at 3.1 percent. On the other hand, the highest annual average inflation rate was recorded in Region VIII (Eastern Visayas) at 5.5 percent.

By Commodity Group

Fuel, Light and Water (FLW) and Services indexes posted negative annual rates in 2009

Compared to 2008, the annual average inflation rates in the Philippines for all the commodity groups either decelerated or were negative in 2009. Negative annual price movements were noticed in FLW and services at -2.6 percent and -0.2 percent, respectively compared to their corresponding last year’s rates of 6.5 percent and 8.6 percent. Moreover, the annual average price increase in food, beverages and tobacco (FBT) index slipped to 5.8 percent from 12.9 percent; clothing, 2.5 percent from 4.2 percent; housing and repairs (H&R), 2.9 percent from 4.3 percent; and miscellaneous items, 2.6 percent from 2.9 percent.

Similarly, the annual average inflation rates in NCR for all the commodity groups either slowed down or were negative in 2009 except for H&R and miscellaneous items index whose annual rates were correspondingly higher at 2.8 percent and 2.2 percent from last year’s 2.5 percent and 1.9 percent, respectively. Annual negative price adjustments were observed in FLW and services index at -1.4 percent and -4.0 percent, from 2.8 percent and 9.5 percent, respectively. Moreover, annual average price increments improved in FBT (5.1%) and clothing (1.5%) from their corresponding rates of 10.1 percent and 5.1 percent.

Slower annual average growth rates were likewise registered in all the commodity groups in AONCR. Annual average inflation for FBT index was slower at 6.1 percent from 13.8 percent; clothing, 3.0 percent from 3.9 percent; H&R, 2.9 percent from 5.7 percent; services, 2.0 percent from 8.0 percent; and miscellaneous items, 2.7 percent from 3.3 percent. The annual rate for FLW index was -3.2 percent from 8.5 percent.

Movement in food prices generally improved in 2009

With enough supply of rice in the market particularly during the harvest months of August, September and October, the annual average price hike for rice in the Philippines decelerated to 7.5 percent in 2009 from 29.1 percent in 2008 as the annual average price increment of the group’s index in NCR and AONCR moved at slower paces of 3.7 percent and 8.1 percent, respectively from their corresponding last year’s rates of 34.0 percent and 28.5 percent. The lowest annual average inflation rate for the group during the year was in Region IV-B (MIMAROPA) at 3.3 percent.

The good production of corn brought about by the favorable weather condition that generally prevailed during the second semester of 2009 resulted to ample supply in the market. This factor contributed to the downward trend in the annual price adjustment of corn index in Philippines, NCR and AONCR at 6.1 percent from their corresponding last year’s rates of 23.2 percent, 10.7 percent and 23.4 percent. Region V (Bicol) had the lowest annual average rate at -0.4 percent during the year.

Annual price hikes in flour and flour products generally decelerated during the year. Thus, the annual average inflation rate of cereal preparations index in the Philippines moved at a slower rate of 7.4 percent from 15.7 percent; NCR, 6.1 percent from 16.0 percent; and AONCR, 7.9 percent from 15.6 percent.

The annual average inflation rates of the dairy products index in 2009 in the three areas were posted at 6.3 percent in the Philippines; 5.1 percent in NCR; and 6.7 percent in AONCR. These rates were slower than their respective double-digit figures of 12.8 percent, 11.4 percent and 13.5 percent in 2008. This was due to the improved prices of milk in NCR and in selected provinces.

Lower production of eggs caused by the slowdown in the growth of chicken and the effects of the cold weather conditions during the months of January, February and December limited its supply in the markets. Increments in the cost of feeds for chicken were also noted. All these factors raised the annual average inflation for the eggs index in NCR to 7.5 percent from 1.0 percent. Annual average inflation in the Philippines and AONCR also moved up but at slower rates of 6.8 percent and 6.5 percent, respectively from their corresponding last year’s average inflation of 6.9 percent and 8.8 percent.

The good catch of fishermen due to favorable weather conditions that were generally experienced in 2009 resulted to sufficient supply of fresh fish species in the markets. It resulted to a slow down in the annual average price gain of the fish index in NCR at 3.6 percent in 2009 from 7.6 percent in 2008; AONCR, 6.6 percent from 9.4 percent; and Philippines, 6.1 percent from 9.1 percent.

Big volume of harvests of vegetables due to favorable weather conditions brought abundant supply of vegetables in the markets. Thus, the annual average price increase in the fruits and vegetable index in the Philippines at 5.9 percent in 2009 was slower than its 2008 rate of 11.7 percent; NCR, 7.8 percent from 7.9 percent; and AONCR, 5.3 percent from 12.8 percent.

Higher consumption of pork in January and December and the presence of ebola virus in hogs in February limited its supply in the markets. The slowing down in the production of chicken also raised prices of meat in the markets. However, the weakening demand for pork and pork products arising from swine flu and ebola virus scare brought down their prices in May. These mixed price trends pulled down the annual average inflation rate for the meat index in the Philippines to 5.4 percent in 2009 from 8.9 percent in 2008, NCR, 4.8 percent from 8.0 percent, and AONCR, 5.8 percent from 9.4 percent. The lowest annual average inflation rate for the meat index during the year at 2.9 percent was registered in Region IX (Zamboanga Peninsula). Region IV-B (MIMAROPA) recorded the biggest slowdown of 6.6 percentage points (5.9% from 12.5%) in its annual average inflation rate.

Annual price hikes in sugar and sugar products, cooking oil, powdered tonic drinks, table salt and selected spices and seasonings in many regions in AONCR were slower compared to last year. Thus, the annual average inflation for the miscellaneous foods index in the Philippines and AONCR correspondingly decelerated to 4.3 percent and 3.8 percent in 2009 from 7.3 percent and 8.2 percent in 2008, respectively. On the other hand, the annual average price increase for the group in NCR remained at 5.4 percent.

Inflation rates for all the commodity groups generally decelerated in all the regions.

The FBT index in all the regions recorded lower annual average inflation rates in 2009. The lowest annual growth in the group’s index at 3.9 percent was seen in Region IV-B (MIMAROPA) while the highest was observed in Region II (Cagayan Valley) and Region VIII (Eastern Visayas) at 8.2 percent.

Among the food groups, the rice index in the Philippines and AONCR posted the highest annual average inflation in 2009 at 7.5 percent and 8.1 percent, respectively. These were however slower than their corresponding 2008 double digit rates of 29.1 percent and 28.5 percent. On the other hand, the lowest annual average inflation in the two areas was correspondingly registered in miscellaneous foods index at 4.3 and 3.8 percent from their respective last year’s rates of 7.3 percent and 8.2 percent. In NCR, the highest annual average inflation rate during the year was in fruits and vegetables index at 7.8 percent from 7.9 percent in 2008 while the lowest annual rate of 3.6 percent was noted in fish index from 7.6 percent.

Compared with 2008, annual upward price movements of footwear and selected ready-made apparel also generally slowed down in 2009. These factors pulled down the annual average inflation rates of the clothing index in the three areas: Philippines, 2.5 percent from 4.2 percent; NCR, 1.5 percent from 5.1 percent; and AONCR, 3.0 percent from 3.9 percent. Among the regions in AONCR, the lowest rate in 2009 was in CAR (Cordillera Administrative Region) at 1.5 percent while the highest rate was in Region XII (SOCCSKSARGEN) at 4.8 percent.

The annual average inflation of the H&R index in the Philippines and AONCR moved at 2.9 percent and in NCR, 2.8 percent due to the increased prices of selected construction materials along with higher rental rates of dwelling units in many regions including NCR during the year. The highest annual growth was in Region XI (Davao) at 5.3 percent. The lowest annual rate of 1.0 percent was observed in Region VII (Central Visayas).

The downward annual price adjustments in electricity rates, LPG and kerosene pulled down the average annual rates of the FLW index in the three areas: Philippines, -2.6 percent from 6.5 percent; NCR, -1.4 percent from 2.8 percent; and AONCR, -3.2 percent from 8.5 percent. The biggest decline of -6.5 percent was noted in Region I (Ilocos) followed by Region III (Central Luzon) at -6.0 percent with Region II (Cagayan Valley) recording the biggest annual decrease of 16.4 percentage points (-3.5% from 12.9 %).

Price declines in petroleum products nationwide together with the implementation of lower bus and jeepney fares in NCR were recorded during the second semester of 2009. These factors pulled down the annual average inflation of the services index in NCR and in the Philippines to -4.0 percent and -0.2 percent, respectively from their corresponding last year’s rates of 9.5 percent and 8.6 percent. In AONCR, the average annual growth of the services index also decelerated to 2.0 percent from 8.0 percent. This was mainly due to the annual price decreases in petroleum products together with the slower annual growth rates in selected medical and personal services in many regions. Compared to 2008, all the regions registered either negative or lower annual inflation rates during the year. The biggest annual drop of 8.9 percentage points (-1.9% from 7.0%) was noticed in ARMM.

Upward movements in the prices of selected items for household operations, laundry and cleaning supplies and personal care triggered a 0.3 percentage point (2.2% from 1.9%) increase in the annual average inflation rate for miscellaneous items index in NCR. On the other hand, average annual inflation in AONCR was slower by 0.6 percentage point to 2.7 percent in 2009 from 3.3 percent a year ago as ten regions registered slower annual average rates. Lower annual growth rates in the prices of selected furniture, furnishings, personal care, laundry and cleaning supplies and personal effects were noted in many regions. The lowest growth rate of 1.9 percent was seen in CAR while the highest rate was observed in Region XII (SOCCSKSARGEN) at 3.7 percent.

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Industry and Trade Statistics Department
National Statistics Office
Manila

Page last updated:
April 20, 2010