PHL wholesale, NCR retail price growth slower in May

Wholesale price growth in the country and retail price growth in the National Capital Region (NCR) both declined to multi-year lows in May amid base effects, the Philippine Statistics Authority (PSA) reported on Friday.

Preliminary data from the PSA showed the country’s overall wholesale price index (GWPI) rose 2.3% year on year that month, down significantly from 5% a year earlier and 2.6% in April.

May’s numbers were the slowest in almost three years, or since the 2.2% recorded in June 2021.

Year to date GWPI averaged 2.8%, down from 5.5% a year ago.

Meanwhile, Metro Manila’s general consumer price index (GRPI) fell to 2% in a separate release, down from 4.9% a year earlier and 2.1% in April.

The current level was the slowest in more than two years or since January 2022’s 1.9% growth.

In the five months to May, the GRPI rose by an average of 2.1%, down from 5.8% a year earlier.

“This year-over-year decline likely reflects a high inflation base from 2023 onwards, potentially lower global commodity prices and an improving supply chain,” said Robert Dan J. Roces, chief economist at Security Bank Corp. in a Viber message.

The PSA attributed the downward trend in the GWPI to various manufactured items, which slowed in May to 0.3% year-on-year from 2% in April.

This was followed by beverages and tobacco (3.1% in May, compared to 4.4% in April), raw materials that are inedible except fuels (4.2% compared to 8.4%) and chemicals, including animal and vegetable oils and fats (2% versus 2.3%).

Other commodities that showed slower growth were manufactured goods classified mainly by materials (1.1% from 1.6%) and machinery and transportation equipment (0.4% from 0.5%).
Bulk price growth on the three major island groups finished mixed in May.

Wholesale price growth in Luzon rose 2.2%, compared to 2.4% in April and 4.9% in May last year.

In the Visayas, GWPI also slowed to 5.6% in May, down significantly from 6.7% in April and 3.9% in May 2023.

On the other hand, price growth in Mindanao grew 1.9%, up from 1.1% in April, but still lower than the 5.7% a year earlier.

Meanwhile, the slowdown in Metro Manila’s GRPI was mainly driven by the heavily weighted food index at 2.5% in the period from 2.6% in April, the PSA said.

The same following commodity groups have hindered retail price growth in NCR: beverages and tobacco (3% from 3.7%), raw commodities that are inedible except fuels (0.6% from 0.8%), chemicals, including animal products and vegetable oils and fats (2.2% from 2.5%) and manufactured goods classified mainly by materials (1.3% versus 1.4%).

Mr Roces said the slowdown is expected to continue in June, with year-on-year growth rates possibly even lower than reported figures.

“Forecasting the full-year trend requires more data, but current data points to a significantly cooler price environment compared to 2023,” Mr Roces said. — Abigail Marie P. Yraola