A miscalculation initially pegged the August inflation rate at a higher 6.6 percent year-on-year, but was spotted early on and corrected by authorities.
Socioeconomic Planning Secretary Ernesto M. Pernia clarified Saturday there was no manipulation of the latest inflation data, contrary to rumors circulating among traders in the market as its release got delayed by over an hour on Wednesday.
The Philippine Statistics Authority’s (PSA) initial report submitted to Pernia carried the 6.6-percent headline inflation figure, but the head of state planning agency National Economic and Development Authority saw an overcalculation of prices covered by the education commodity group. The statistics agency did not take into account the free tuition scheme now being implemented in state universities and colleges, he said.
Following a correction of the computation, the government later on reported that the rate of increase in prices of basic goods and services surged 6.4 percent year-on-year, the fastest in over nine years.
“It’s normal that the PSA’s first data releases are preliminary—in effect, subject to revisions. This applies to national income accounts such as gross domestic product (GDP), consumer price index, producer price index, monthly integrated survey of selected industries and labor force survey, etc.,” Pernia explained.
“Recall that the 2016 GDP growth was first reported at 6.8 percent, later revised to 6.9 percent; similarly, first-quarter 2018 GDP growth was 6.6 percent, later changed to 6.4 percent. In the case of August 2018 inflation, the revision was also an appropriate and necessary ‘corrigendum’ (Latin for ‘to be corrected’) as the error was detected early,” Pernia said.
The Neda chief said the government had “no intention of hiding” the mistake in the PSA’s initial computation of the inflation rate in August.
“We just thought it prudent and not necessary to announce it as it might only lead to confusion among the public, especially those unfamiliar with standard procedures,” he said.
To recall, the market went jittery as the PSA released its August inflation report more than one hour late, releasing it to the media past 10 a.m. on Wednesday.
The PSA had apologized for the delay, claiming “technical difficulties due to clogged website because of volume of those trying to get into it.”
Why the Bangko Sentral should raise interest rates anew