By Mark T. Amoguis, July 29 2019; Business World
Image Credit to Business World
JUNE inflation, as experienced by low-income families, softened to its slowest pace in 18 months, according to the Philippine Statistics Authority.
The inflation rate for the country’s bottom 30% income households was at four percent, slower than the year-on-year increase of 4.6% in May and 6.7% in June 2018. This was the slowest in 18 months or since the 3.7% recorded in December 2017.
For the first half, the inflation rate for this income segment averaged 4.7%, slower than the 5.9% average in the first half of 2018.
That coincided with results of the Second Quarter 2019 Social Weather Survey by the Social Weather Stations that saw the proportion of self-rated poor families decline to 45% in June 2019 from 48% in June 2018 albeit higher than the 38% reading in March 2019. On the flip side, the proportion of self-rated “food-poor” families was 35% versus the record-low 27% in March and 34% in June 2018.
The bottom 30% inflation likewise compared to the 2.7% headline inflation experienced by the average household in June, slower than the 3.2% figure in May, even as the consumer price index (CPI) used in measuring headline inflation uses 2012 prices compared to the CPI for the bottom 30% income households, which uses 2000 prices.
Aside from differing base years, the CPI for the bottom 30% income segment of the population reconfigures the model basket of goods, assigning heavier weight on food, beverage and tobacco (FBT), as well as other necessities as these are thought to more accurately capture the spending patterns of the poor.
Inflation in the FBT index was at 4.3% in June, slower than the 4.8% reading in May. Likewise, the food-alone index cooled to 3.9% from 4.3% previously.
Among select food items, slowdowns were observed in cereals (to 0.5% from 1.2%), rice (0.9% from 1.9%), dairy products (3.2% from 3.3%), fish (7.6% from 7.8%), fruits and vegetables (9.3% from 9.9%), meat (1.9% from 2.4%), and miscellaneous food items (4.6% from five percent).
On the other hand, inflation upticks were seen in eggs at 2.5% from 2.3% while that of corn edged up somewhat with a 1.5% decline from the 1.8% markdown. The rate of cereal preparations was steady at 3.9%.
Aside from food, a smaller annual increase was observed noted in fuel, light and water to 2% from the previous 3.9%.
Meanwhile, inflation rates for clothing as well as for housing and repairs inched up to 3.3% from 3.2% and 4.2% from 4.1%, respectively. The annual rate of services and “miscellaneous” commodity groups steadied at 3.7% and 2.5%.
Inflation experienced by poor households in the National Capital Region was recorded at 1.6%, slower than the 2.6% recorded in May. Similarly, those living outside of Metro Manila saw a slower inflation rate at 4.1% from 4.6%.
All the regions posted slower annual inflation, except for the MIMAROPA (Occidental and Oriental Mindoro, Marinduque, Romblon and Palawan) Region and Central Visayas. The inflation rate in MIMAROPA, south of Metro Manila, steadied at 10.3% from the previous month while that of Central Visayas accelerated to 3.7% from 3.6%.