r-revised

·  Producer Price Index slides further

The Producer Price Index (PPI, 2000=100) for the manufacturing industry dropped by 5.4 percent in May 2010, compared with the year ago level, according to the preliminary results of the Monthly Producer Price Survey. Furniture and fixtures recorded the biggest decline of 21.1 percent followed by other two major sectors that posted significant decrements namely: machinery except electrical (- 18.9%) and electrical machinery (-15.8%). On the other hand, ten major sectors exhibited increases in PPI led by petroleum products and footwear and wearing apparel with two-digit growth of 14.0 percent and 10.5 percent, respectively. Refer to Tables 1 and 1-B.

On a month-on month basis, PPI slightly recovered with a 0.2 percent growth in May from a 2.9 percent drop in the previous month. This was brought about by the increases exhibited by twelve major sectors led by machinery except electrical (2.6). Moreover, flat growth were observed in four major sectors. Refer to Tables 1 and 1-B.

·  Response Rate

The response rate for May 2010 is 85.4 percent, which corresponds to the retrieval of 274 sample establishments� reports. Refer to Table 2.

Response Rates for Total Manufacturing
(In percent)

·  Technical Notes

The National Statistics Office generates various price indices, one of this is the Producer Price Index. (PPI). The PPI is generated through the results of the Producers Price Survey (PPS) conducted nationwide. The survey gathers monthly actual producer prices of selected products included in the market basket.

PPI utilizes the Paasche-type method of index computation with weights computed from the production concentration ratio of the Census of Philippine Business and Industry (CPBI)/ Annual Survey of Philippine Business and Industry (ASPBI). The weights are updated as soon as new results of the ASPBI/CPBI are available and applied at the beginning of each survey year.

Hence, the weights of the major sectors and sub-sectors for the 2009 PPI were computed from the results of the 2006 CPBI for Manufacturing Establishments of total employment of 20 and over, which is the latest census results. The 2010 PPI still uses the same weights.

Moreover, for industry classification, the 2010 PPI utilizes the amended 1994 Philippine Standard Industry Classification. Rubber and Plastic Products is a new major sector, beginning the 2008 PPI, consisting of two sub-sectors, namely: Rubber Products and Plastic Products. Rubber Products was previously a major sector while Plastic Products was one of the sub-sectors of Chemical Products.

Previously, with seven sub-sectors, the major sector of Chemical Products now has six sub-sectors, namely: Basic Chemical and Industrial Gases, Fertilizers, Paints, Drugs and Medicines, Cosmetics and Toilet Preparations and Miscellaneous Chemicals.

Non-responding sample establishments are estimated using cold-deck imputation method. Revisions to the preliminary estimates are done upon receipt of actual reports from late respondents.

TABLE 1-A. PRODUCER PRICE INDEX, APRIL 2010 - MAY 2010
(2000=100)

TABLE 1-B. PRODUCER PRICE INDEX, APRIL 2010 - MAY 2010
(2000=100)

Note:

* - new sector in the 2000-based series

a/ - less than 0.1 percent increase

b/ - less than 0.1 percent decrease

Sectors are ranked according to their contribution to the overall 2000-based growth rate.

Year-on-year growth rates are computed by dividing the current month index by previous year same month index less 1.

Month-on-month growth rates are computed by dividing the current month index by previous month index less 1

Source:   National Statistics Office
                 Manila, Philippines