The buying power of the peso in the Cordillera Administrative Region (CAR) has gone down by 22 centavos since 2006 based on data from the National Statistics Office (NSO). Due to the general rise in the prices of goods and services, the Purchasing Power of the Peso (PPP) declined from 81 centavos in 2011 to 78 centavos in 2012.
The PPP is a measure of the real value of the peso in a given period relative to a chosen reference period. It is computed by getting the reciprocal of the Consumer Price Index (CPI) and multiplying the result by 100. The CPI is an indicator of the change in the average prices of a fixed basket of goods and services commonly purchased by households relative to a base year while inflation rate is the annual rate of change or the year-on-year change in the CPI. (NSCB Resolution No. 11 Series of 2003).
The average CPI for all items in CAR rose by about 3.7 percent or from 123.7 in 2011 to 128.2 in 2012. This was slightly higher than the inflation rate of 3.2 percent recorded in the previous year. During the last 10 years, prices in the region spiked in 2008 when the highest inflation rate was recorded at 6.9 percent.
Among the Cordillera provinces, the largest year-over-year increases in prices occurred in Ifugao (7.0%) while the smallest were posted by Abra (2.2%). In terms of PPP, the peso had the highest value in Apayao at 84 centavos while Mt. Province had the least value at 75 centavos in 2012.
This issue of the Stat News can also be accessed at: http://www.nscb.gov.ph/rucar/sn13_01_ppp.htm