By Abigail Marie P. Yraola, Researcher

GROWTH in wholesale prices of general goods eased in November, its weakest pace in five months, the Philippine Statistics Authority (PSA) reported on Friday.

Preliminary data from the PSA showed the general wholesale price index (GWPI) slowed by 4.2% year on year, significantly lower than the 7.2% in November 2022 and 4.4% in October.

The November reading was the slowest since the 4% recorded in June 2023.

Year to date, GWPI averaged 4.9%, lower than the 7.4% a year ago.

Robert Dan J. Roces, chief economist at Security Bank Corp. said that the November might be a result of the economy adjusting post-pandemic and spending patterns returning to normal, which could lead to reduced demand pressures.

“Improved supply chain conditions, which may have reduced logistical costs and supply shortages that previously drove prices higher, as well as stabilization or decline in global commodity prices, particularly if the goods are imported or influenced by global markets,” he said in a Viber message.

Additionally, he said a possible cause for the slowdown in bulk prices is the government or central bank policies that may have reduced inflationary pressures, such as adjusting import tariffs or providing subsidies.

The indicator could also be indicating base effects from a year earlier, Mr. Roces added.

In its December policy meeting, the Bangko Sentral ng Pilipinas (BSP) decided to maintain its benchmark interest rate at a 16-year high of 6.5%.
The decision came after the BSP had raised rates by a cumulative of 450 basis points between May 2022 and October 2023 in its efforts to control inflation.

The PSA said that the downtrend seen in November is due to the downtrend in the index of mineral fuels, lubricants, and related materials which contracted by 6.7% from a 3.7% decline in October.

This was followed by miscellaneous manufactured articles (3.3% from 3.6%) and chemicals including animal and vegetable oils and fats (1.5% from 1.8%).

Other commodities that logged slower growth were the heavily weighted food index (6.8% from 7%) and machinery and transport equipment (1.3% from 1.5%).

Meanwhile, manufactured goods classified chiefly by materials remained at 4.6%.

On the other hand, beverages and tobacco stood at 6.2% from 6% in October while a slower annual decline was logged in the index of crude materials, inedible except fuels at 1.9% in November from its 3.5% decline a month earlier, the PSA said.

Bulk prices growth in Luzon and the Visayas slowed while it further rose in Mindanao.

Wholesale price growth in Luzon eased by 4.1% during the period from 7.4% in November 2022 and 4.4% in October last year.

In the Visayas, GWPI likewise slowed by 5.2% in November, significantly lower from 6.5% in the same month in 2022 and 5.3% in October 2023.

On the other hand, price growth in Mindanao grew by 3.6% against the 4.8% in November 2022. It also picked up from the 3.3% in October 2023.

“If the trends observed in November continue and barring any unforeseen supply shocks or significant policy changes, the general trajectory of wholesale prices might remain stable or continue to ease slightly,” Mr. Roces said.