Tarlac’s Inflation Increases to 8.7 Percent
Inflation in the Province of Tarlac went up to 8.7 percent in October 2022 from 7.7 percent in September 2022. With this month’s inflation, the province’s average inflation from January to October 2022 stood at 5.7 percent. In October 2021, inflation rate was posted at 5.3 percent. (Figure 1 and Table A)
The increase in province’s inflation was mainly brought about by the increase in the index for commodity group of Housing, Water, Electricity, Gas, and other Fuels at 15.0 percent, from 14.9 percent in the previous month. This was followed by Alcoholic Beverages and Tobacco at 10.9 percent, from 10.4 percent in the previous month. Food and Non-Alcoholic Beverages also increased at 9.5 percent, from 6.8 percent in the previous month. This was followed by Recreation, Sport and Culture whose index increased to 8.5 percent, from 6.9 percent in the previous month. The index for Personal Care, and Miscellaneous Goods and Services also increased to 4.0 percent, from 3.7 percent in the previous month. This was followed by Restaurants and Accommodation Services at 2.9 percent, from 1.9 percent in the previous month.
On the other hand, the index for commodity group of Transport decreased at 9.9 percent, from 11.9 percent in the previous month. This was followed by Furnishings, Household Equipment, and Routine Household Maintenance decreased at 6.4 percent, from 6.6 percent in the previous month. Clothing and Footwear also decreased at 1.8 percent, from 3.3 percent in the previous month. This was followed by Health whose index decreased at 1.7 percent, from 2.0 percent in the previous month. Information and Communication also decreased at 0.6 percent, from 1.0 percent from the previous month.
Meanwhile, commodity groups that retained their previous month’s inflation rate are the following:
a. Education Services (2.7%); and
b. Financial Services (0.0). (Table B)
The annual growth rate of the rice index went down to 0.4 percent during the month, from 2.3 percent in the previous month. Meanwhile, the corn index growth rate also went up at 14.3 percent.
The following items for food commodity groups that showed an increase during the month were Meat and other parts of slaughtered land animals at 9.9 percent, from
8.3 percent in the previous month. This was followed by Fish and other seafood at 10.8 percent, from 8.5 in the previous month. Milk, other dairy products, and eggs at 12.8 percent, from 12.2 percent in the previous month. The index for Sugar, confectionery and Desserts also increased to 33.6 percent, from 27.9 percent in the previous month. This was followed by the index of Ready-Made Food and Other Food Products N.E.C. at 12.1 percent, from 11.1 percent in the previous month.
On the other hand, the following food groups exhibited a decrease in annual growth during the month:
a. Flour, Bread and Other Bakery Products, Pasta Products, and Other Cereals at 11.8 percent, from 12.4 percent in the previous month;
b. Oils and Fats at 21.1 percent, from 22.7 percent.
In Central Luzon, the province of Nueva Ecija had the highest inflation rate for the month of October 2022 with 11.6 percent. This was followed by the province of Bataan with 11.0 percent, the province of Aurora with 10.7 percent, the province of Zambales with 9.8 percent, followed by the province of Pampanga with 9.3, and the province of Tarlac at 8.7 percent.
However, the province of Bulacan had the least inflation rate posted at 4.8 percent. (Figure 2)
Computation of Consumer Price (CPI)
The computation of the CPI involves consideration of the following important points:
a. Base Period – The reference date or base period is the benchmark or reference date or period at which the index is taken as equal to 100.
b. Market Basket – A sample of the thousand varieties of goods purchased for consumption and services availed by the households in the country selected to represent the composition price behavior of all goods and services purchased by consumers.
c. Weighting System – The weighting pattern uses the expenditures on various consumer items purchased by households as a proportion to total expenditure.
d. Formula – The formula used in computing the CPI is the weighted arithmetic mean of prices relatives, the Laspeyre’s formula with a fixed base year period (2006) weight.
e. Geographic Coverage – CPI values are computed at the national, regional and provincial levels, and for selected cities.
Inflation Rate is the rate of change of the CPI expressed in percent. Inflation is interpreted in terms of declining purchasing power of peso.
Headline Inflation refers to the rate of change in the CPI, a measure of the average standard “basket” of goods and services consumed by a typical family.
Purchasing Power of Peso shows how much the peso in the base period is worth in the current period. It is computed as the reciprocal of the CPI for the period under review multiplies by 100.
Note: CPIs and Inflation Rates are posted at the PSA website (https://openstat.psa.gov.ph/)