PRICE INDICES OF THE PHILIPPINES CPI CPI measures changes in the average retail prices of a market basket or collection

of goods and services commonly purchased by Filipino household. WPI WPI measures the monthly changes in the general price level of commodities that flow into the wholesale trade intermediaries whether the commodities are produced locally or imported for resale. 1. It is a measure of change in 1. It is an important indicator of the value of money or of the current business situation and economic trend . purchasing power of the currency. 2. It is used as basis for price 2. It is used as basis for adjustments in business determining inflation rates. contracts and projects. 3. It is used as basis for adjusting or escalating wages, contracts, pensions, taxes and other transaction flows. 4. It is used as basis for redirecting fiscal and monetary policies, and trade and exchange rate policies. PPI PPI measures average changes in selling prices received by domestic producers for their output.

Description

Uses

1. It measures monthly or yearly changes in producers prices (explant) of key commodities in the manufacturing sector. 2. It serves as deflator to Value of Production Index (VaPI) in the estimation of Volume of Production Index (VoPI). 3. It serves as deflator in the estimation of manufacturing production in the system of national accounts.

PRICE INDICES OF THE PHILIPPINES CPI Based on 1994 Family Income and Expenditures Survey. Levels of consumption by item are gathered and used as weights. Items are weighted in proportion to national expenditure and geographical weights are based on provincial weights. 1994=100 National, Regional and Provincial Criteria for Selecting of Sample Establishments: a. b. c. d. e. Popularity of an establishment Consistency of the stock Permanency of the outlet Accessibility of the outlet Cooperativeness of the price informant WPI PPI Based on 1985 Input-Output Table Based on the 1995 Annual Survey of (value of domestic production at Establishments (ASE) producer prices+imports wholesale and trade mark-ups except mark ups for imported crude oils.

Weights Used

Base Year Coverage Selection of respondents and types of outlets

1985 = 100 1994=100 Metro Manila Metro Manila Criteria for Selecting of Sample Criteria for Selecting of Sample Establishments: Establishments: a. Popularity of an establishment b. Consistency of the stock c. Permanency of the outlet d. Accessibility of the outlet e. Cooperativeness of the price informant a. Establishments has an average total employment of 50 and over; b. Establishment has relatively high concentration ratio in terms of value of sales; and c. Establishment is good respondent in past and current surveys of NSO, that is, it submits prompt reports and provides quality data.

PRICE INDICES OF THE PHILIPPINES CPI The Commodity Outlet Survey (COS) is conducted a) to identify the market basket by income levels, and b) to determine the commodity that the household consumes most of the time and the outlets where these commodities are commonly purchased. WPI Criteria for Selecting Commodities: a. Popularity of the variety of the commodity (implies representativeness with respect to the commodity); PPI Criteria for Selecting Commodities: a. The commodity has relatively high market share; b. The commodity is available in the market during the base year;

Selection of commodities or market basket

Commodity Groups

b. Consistency of supply (sustained availability of c. The commodity is being This survey is conducted every 3 supply from the base period to produced currently; and years using the sample households the present); and of the recent Family Income and d. The market share of the Expenditure Survey (FIES). commodity has been stable for c. The commodity has relatively the last three (3) years based on Criteria for selecting commodities high market share. ASE/CE reports. are the same as in WPI. 1. Food, Beverages and Tobacco 1. Food 1. Food Manufacturing 2. Clothing 2. Beverages & Tobacco 2. Other Food Manufacturing 3. Housing & Repairs 3. Crude Materials, inedible 3. Beverage 4. Fuel, Light & Water except Fuels 4. Tobacco 5. Services 4. Chemicals, incl. Animal and 5. Textile 6. Miscellaneous Vegetable Oils 6. Wearing Apparel 5. Manufactured Goods classified 7. Leather & Leather Products chiefly by material 8. Footwear 6. Machinery and Transport 9. Wood & Wood Products Equipment 10. Furniture & Fixtures 7. Miscellaneous Manufactured 11. Pulp, Paper & Paperboard Articles 12. Printing & Publishin

PRICE INDICES OF THE PHILIPPINES CPI WPI PPI 13. Industrial Chemicals 14. Other Chemical Products 15. Petroleum Refineries 16. Miscellaneous Petroleum 17. Rubber Products 18. Plastic Products 19. Other Non-Metallic 20. Glass & Glass Products 21. Cement 22. Iron & Steel 23. Non-Ferrous Metals 24. Fabricated Metals 25. Machinery 26. Electrical Machinery 27. Transport Equipment Other Manufacturing Industries Every month

Frequency of collection No. of Outlets No. of Commodities Priced

Collected twice a month except for FBT which are collected weekly. 9,500 Number of commodities included in the market basket differ for each of the provinces; it ranges from 285 to 707 commodities.

Collected twice a month.

197 =(GWPI +WPICM) GWPI =410 WPICM = 115

180 300

PRICE INDICES OF THE PHILIPPINES CPI Monthly CPI, together with inflation rate is available 5 days after the reference month. Release of these information is done simultaneously to all media outlets every fifth day of the month. CPI by Region and commodity group and inflation rate are in the Monthly Bulletin of Statistics, Journal of Philippine Statistics and the Philippine Yearbook. CPI information are also released in the form of special releases and in the form of an Annual Report together with WPI and RPI. WPI General WPI is available 35 days after the reference month. CMWPI (for construction materials) is available 15 days after the reference month. PPI Special release to media outlets is available every 55th day after the reference month. The index is available at national level at 3digit PSIC. Available in NSO website 56th day after the reference month. Publication in the form of Industry Trends is released every 60th day after the reference month.

Availability of Results

Regularly published in Monthly Bulletin of Statistics, Journal of Philippine Statistics and the Philippine Yearbook.

PRICE INDICES OF THE PHILIPPINES CPI Minor repairs Housing rentals The formula used in computing the CPI is the weighted arithmetic mean of price relatives, a variant of the Laspeyres formula with a fixed base year period and weights. WPI Minor repairs Laspeyres method with fixed base and weight PPI Not included Paasche-type Current weights are used. Weights are continuously revised based on the availability of latest Annual Survey of Establishments (ASE) or Census of Establishments (CE). Revision of the weights to be done only at the beginning of each year (January) and be used for the entire year. 1. At 4-digit PSIC (Sub-sector) N a) PRij = P1h/Poh n=1 x 100 N

Housing Included? Type of Index Formula

Formula for Computing Index

Pn CPI = -------- (PoQo) Po ----------------------- x 100 (PoQo) where: Pn = current period price Po = base period price PoQo = weights based on FIES

Same as in constructing CPI.

PRICE INDICES OF THE PHILIPPINES CPI WPI PPI

b) PRijm = PRijm-1 x (Phm/Phm-1)
n=1 N

2. At 3-digit PSIC (Major Sector) 1 Ij = p

Wij(PRij) i =1

3. At 1-digit PSIC (Total Manufacturing) 1 Im =

q

Wj(1 / Ij)
j=1

PRICE INDICES OF THE PHILIPPINES CPI WPI PPI of of ! Disappearance ! Disappearance ! Disappearance of commodities that are commodities that are commodities that are monitored monitored monitored of sample of sample ! Closure ! Closure ! Closure of sample establishments establishments establishments researches ! There is problem on the ! Statistical ! Inability of the methodology currently replaced commodities that establishments to submit adopted for collecting are different from the accomplished questionnaires housing rental; replaced ones (different on time concentration ratio of each specs, size, weight or ! Unable to meet time lag of type of residential brand) causing the six weeks for the release of building from which prices distortion of price trends. PPI are collected are not considered in determining the samples for this purpose. Rebasing of CPI to 2000 will be Expansion of coverage by Rebased to 1994 and this will be undertaken by conducting the including Cebu City and Davao released by May 2000. 2000 COS. City to represent Visayas and Mindanao Regions

Special problems

Future Plans

Note: The Philippines does not generate retail sales indices.