Retail price growth in Metro Manila hit a near 14-year high in October amid surging basic commodity prices fueled by a second-round base effect of domestic inflation, the Philippine Statistics Authority (PSA) reported on Friday.
Retail price growth in the National Capital Region, as reported in the general retail price index (GRPI), grew by 6% in October, higher than the 5.9% in September and 2.1% in the same period last year.
The October index was the highest in nearly 14 years or since the 6.8% in November 2008.
The growth was attributed to the increase in food which increased by 9.5% from 8.6% in the previous month.
Likewise, the GRPI in beverages and tobacco, picked up by 7% from 6.9% in September. This was followed by crude materials, inedible except fuels which increased by 3.1% from 2.9%. Chemicals, including animal and vegetable oils and fats grew by 3.6% from 3.5%. Meanwhile, miscellaneous manufactured articles inched up by 1.3% from 1.2%.
Mineral fuels, lubricants and related materials, however, eased by 17.3% from 25.5% in September.
Machinery and transport equipment and manufactured goods classified chiefly by materials stood at 1.1% and 3.4%, respectively.
In the year to date, retail price growth in the National Capital Region (NCR) averaged 4.1%, up from 1.9% a year earlier.
“The general retail price continues to increase as second round effects from persistently high inflation seep into retail prices. Prices of beverages may have also been pushed up by the price of sugar, which has been spiraled higher due to shortages in domestic production and delayed importation,” China Banking Corp. Chief Economist Domini S. Velasquez said in a Viber message.
The latest headline inflation in November quickened to 8%, a 14-year high. This was also the fastest recorded since the 9.1% during the Global Financial Crisis in November 2008.
Ms. Velasquez forecasted a continued increase in NCR’s retail prices as the country’s inflation continues to surge.
In a text message, UnionBank of the Philippines, Inc. Chief Economist Ruben Carlo O. Asuncion said the rising demand and imported inflation are the main drivers for the increase in retail prices in NCR.
“In the coming months, we may have to see the said index’s rise for the same factors. Nevertheless, rising interest rates and dampened demand, as indicated by the BSP’s CES, may come to bite sooner rather than later,” Mr. Asuncion added. — Mariedel Irish U. Catilogo