NCR retail price growth steadies in February

RETAIL price growth of general goods in Metro Manila steadied in February, the Philippine Statistics Authority (PSA) reported on Friday, noting price acceleration in crude materials, inedible except fuels and manufactured goods classified chiefly by materials.

Citing preliminary data, the PSA reported that the general retail price index (GRPI) in the National Capital Region (NCR) grew 2.1% year on year in February, unchanged from January.  A year earlier, price growth had been 1.2% growth.

The February reading is the strongest since the 2.5% posted in January 2024.

In the year to date, GRPI growth averaged 2.1%, up from 1.3% a year earlier.

Ateneo Center for Economic Research and Development Senior Research Fellow Ser Percival K. Peña-Reyes said the year-on-year growth in retail prices in the NCR was down to “selective price increases in certain commodity groups (beverages and tobacco, crude materials except fuels); steady price trends in many retail goods (manufactured goods, chemicals like oils and fats, machinery, miscellaneous manufactured articles, food); and a dampening effect from weaker or declining prices of mineral fuels and lubricants,” he said via Viber.

The PSA noted a pickup in the indices of crude materials, inedible except fuels (3% in February from 2.8% in January) and manufactured goods classified chiefly by materials (1.6% from 1.5%).

“The February acceleration was largely a cost-push effect due to rising prices of key raw materials (especially chemicals and oils), which meant increased costs for producers and higher prices for manufactured goods and related retail items,” Mr. Peña-Reyes said.

Year-on-year growth in the mineral fuels, lubricants, and related materials index was 1%, a turnaround from the 0.4% decline in the previous month.

Meanwhile, slower yearly growth was seen in the indices of food at 3.4% in February, down from 3.6% in January, and machinery and transport equipment at 0.5%, against 0.7% previously.

The indices of other commodity groups steadied in February from their respective levels in January.

The GRPI is based on 2012 constant prices.

Rizal Commercial Banking Corp. Chief Economist Michael L. Ricafort said price gauges could climb further in the coming months due to oil price hikes and the weaker peso.

“Both of which would lead to higher prices of imports, and overall inflation, with risk of second-round inflation effects or higher prices of other affected goods and services,” he said in a text message.

He also cautioned about rate hikes by the central bank to keep inflation within the 2%-4% target range.

Meanwhile, Mr. Peña-Reyes expects GRPI growth to remain stable in the short term.

“By mid-year onward, there could be a gradual upward bias, driven by fuel, food, and demand-side pressures. Overall, we can expect controlled, moderate growth, but not a surge,” he said.

The PSA uses the GRPI as a deflator in the National Accounts, particularly in the retail trade sector, and serves as a basis for forecasting. — Isa Jane D. Acabal