MANILA – The producer price index (PPI) for manufacturing slightly went up to 0.5 percent in August from 0.05 percent in July, the Philippine Statistics Authority (PSA) said.
In a report released on Friday, the PSA said the PPI during the month was however lower than the annual increase of 7.4 percent in August last year.
"The increase in the annual growth rate of PPI in August 2023 was primarily brought about by the faster annual increase in manufacture of computer, electronic and optical products industry division at 2.5 percent in August 2023 from 1.2 percent in July 2023," said the PSA.
The PSA added that the manufacture of food products with a higher annual growth rate of 2.6 percent during the month from 2.0 percent in July, also contributed to the higher PPI.
Month-on-month, the PPI for manufacturing settled at 0.3 percent, slightly higher than the 0.2 percent seen in July this year.
In August 2022, a monthly decrease of -0.2 percent was observed.
The top contributor to the monthly increment of PPI in August 2023 was the manufacture of coke (fuel) and refined petroleum products with 1.3 percent increase during the period from -0.2 percent monthly drop in July 2023.
The PPI is generated from the results of the Producer Price Survey, which is conducted nationwide.
The survey gathers monthly producer prices of selected products included in the market basket.
"The slight pick up in year-on-year producer prices could be attributed to higher prices of rice, oil, food especially vegetables after some storm damage since the latter part of July 2023," Rizal Commercial Banking Corporation (RCBC) chief economist Michael Ricafort said in Viber message.
Ricafort said the higher minimum wages in Metro Manila which partly led to higher prices of other goods and services by some businesses, also led to higher importation costs and overall inflation.
"For the coming months, year-on-year PPI could still pick up due the effects of the said factors, risk of El Niño drought expected in the fourth quarter of 2023 up to first quarter of 2024, and some normalization of the inflation base," he said.
Ricafort said however that the recent decline in global rice prices and the imposition of the temporary price ceiling on regular and well-milled rice could help stabilize local rice prices. (PNA)