Metro Manila retail price growth eases in 2020

RETAIL PRICE growth in the National Capital Region slowed to 1.2% in 2020, from 1.6% a year earlier, mainly due to lower fuel prices, the Philippine Statistics Authority (PSA) said Tuesday.

The PSA said in December, the general retail price index (GRPI) rose 1.1%, decelerating from the year-earlier rate of 1.7% and the 1.3% rise in November.

It attributed the slowdown to a sustained downtrend of GRPI of mineral fuels, lubricants and related materials, which fell 6.3% in December after having declined 7.9% drop in November. A year earlier, the December GRPI rose 4.1%.

Growth in retail food prices slowed to 2% from 2.2% a year earlier, while that of chemicals, including animal and vegetable oils and fats, rose 0.1% compared to a rise of 0.9% a year earlier.

Manufactured goods classified chiefly by materials also posted slower growth of 1.1% in December compared with 1.4% a year earlier, while price growth in miscellaneous manufactured articles slowed to 0.4% from 1.1% previously.

On the other hand, price growth accelerated in beverages and tobacco (6.1% from 3.4%) and crude materials, inedible except fuels (1.7% from 1.1%).

Price growth in the machinery and transport equipment segment was unchanged at 0.5%.

In 2020, the GRPI of mineral fuels, lubricants and related materials fell 7.6%, against the 1.4% decline in 2019.

Also decelerating were price growth in food (2.3% from 2.6% in 2019), crude materials, inedible except fuels (1.6% from 3.9%), chemicals, including animal and vegetable oils and fats, (0.5% from 1.2%) and machinery and transport equipment (0.1% from 0.7%).

Price growth in beverages and tobacco in 2020 accelerated to 4.7% from 2.8%, while miscellaneous manufactured articles price growth ticked up at 0.9% from 0.7%.

Price growth in manufactured goods classified chiefly by materials was unchanged at 1.4%.

Security Bank Corp. Chief Economist Robert Dan J. Roces attributed the decline in general retail prices to weak consumer demand last year due to the pandemic and quarantine restrictions.

“This was notable in the food, fuel, and manufactured indices; these declined more in the March to June ECQ (enhanced community quarantine) period,” Mr. Roces said via Viber.

“Interestingly, towards the end of the year, we may glimpse the slow climb from food and fuel which are, as we know, contributing primarily to the inflation pressures at the start of 2021,” he added.

The government placed Metro Manila under ECQ from mid-March to May to curb the spread of the coronavirus. Quarantine restrictions have been relaxed since June. — Beatrice M. Laforga