Starting February 2022, the Philippine Statistics Authority (PSA) released the rebased Consumer Price Index (CPI) for all income households to base year 2018, from base year 2012 as announced in the press release number 2022-01 dated 04 January 2022. The CPI series for all income households for January 2022 onwards will be 2018-based.

A.    The Philippines

The Philippines’ headline inflation or overall inflation eased to 3.3 percent in August 2024 from 4.4 percent in July 2024. This brings the national average inflation from January to August 2024 at 3.6 percent. In August 2023, inflation rate was higher at 5.3 percent. (Table A)
B. Central Visayas

1.    Regional Inflation

Inflation in Central Visayas decreased to 4.5 percent in July 2024 from 4.8 percent in June 2024. This brings the regional average inflation from January 2024 to July 2024 at 3.6 percent. In July 2023, inflation rate recorded at 4.1 percent. (Table A)

C. City of Mandaue

1.    Headline Inflation

Following the trend at the national and regional level, inflation rate in Mandaue City decelerated to 5.6 percent in August 2024 from 6.2 percent in July 2024. The city’s average inflation rate from January to August 2024 stood at 6.8 percent. In August 2023, the inflation rate in the city was lower at 3.0    percent. (Table A and Figure 1)

1.1    Main Drivers to the Downward Trend of the Headline Inflation

The downtrend in the city’s headline inflation in August 2024 was primarily influenced by the slower year-on-year increases of food and non-alcoholic beverages at 2.7 percent and health at 3.5 percent from their previous month’s respective inflation rates at 6.0 percent and 4.0 percent. Also contributed to the downtrend was transport with an annual drop of 2.3 percent during the month from 3.1 percent annual increase in July 2024. (Table 3)

In addition, slower annual increments were also noted in the indices of personal care, and miscellaneous goods and services at 3.3 percent and recreation, sport and culture at 4.3 percent in August 2024 from their respective inflation rates at 3.4 percent and 4.5 percent in July 2024. (Table 3)

On the contrary, faster year-on-year increases during the month were observed in the indices of housing, water, electricity, gas and other fuels at 17.6 percent from 13.3 percent in July 2024, and education services at 3.2 percent in August 2024 from 2.7 percent in the previous month. (Table 3)
Moreover, the indices of the following commodity groups retained their previous month’s annual growth rates:

a.    Alcoholic beverages and tobacco, 0.9 percent;
b.    Clothing and footwear, 0.5 percent;
c.    Furnishings, household equipment and routine household maintenance, 3.5 percent;
d.    Information and communication, 0.1 percent;
e.    Restaurants and accommodation services, 0.9 percent; and 
f.    Financial services, -0.4 percent. (Table 3)

1.2 Main Contributors to the Headline Inflation

The top three commodity groups contributing to the August 2024 headline inflation were the following:

a.    Housing, water, electricity, gas and other fuels with 77.7 percent share or 4.4 percentage points;
b.    Food and non-alcoholic beverages with 15.3 percent share or 0.9 percentage points; and 
c.    Personal care, and miscellaneous goods and services with 2.2 percent share or 0.1 percentage point.

2. Food Inflation

Food inflation at the city level eased to 2.9 percent in August 2024 from 6.5 percent in July 2024. In August 2023, food inflation stood at 5.1 percent. (Table 7)

2.1 Main Drivers to the Downward Trend of Food Inflation

The deceleration of food inflation in August 2024 was mainly brought by slower year-on-year increases in the indices of rice at 10.3 percent, corn at 14.1 percent and vegetables, tubers, plantains, cooking bananas and pulses at 8.3 percent from their previous month’s respective inflation rates at 16.8 percent, 35.4 percent and 27.5 percent. The faster annual decrease of fish and other seafood index also contributed to the trend with 14.0 percent during the month from 11.8 percent annual drop in July 2024. (Table 5)

In addition, lower inflation rates were also noted in the following food groups during the month:

a.    Ready-made food and other food products not elsewhere classified, 6.0 percent from 7.3 percent;
b.    Sugar, confectionery and desserts, -5.0 percent from -3.8 percent;
c.    Oils and fats, 0.1 percent from 0.2 percent; and 
d.    Flour, bread and other bakery products, pasta products, and other cereals, 1.7 percent from 2.3 percent. (Table 5)

On the other hand, slower annual decrease in milk, other dairy products and eggs index at 0.2 percent in August 2024 from 1.3 percent annual drop in July, while faster annual increase in fruits and nuts index at 8.7 percent in August 2024 from 4.8 percent in July 2024. (Table 5)
Moreover, meat and other parts of slaughtered land animals food group retained its previous month’s inflation rate at 5.3 percent. (Table 5)

2.2 Main Contributors to the Food Inflation

Food inflation shared 14.7 percent or 0.8 percentage points to the overall inflation in August 2024. The top three food groups in terms of contribution to the food inflation during the month were the following:

a.    Cereals and cereals products, which includes rice, corn, flour, bread and other bakery products, pasta products, and other cereals, with 106.5 percent share or 3.1 percentage points;
b.    Meat and other parts of slaughtered land animals, with 29.4 percent share or 0.9 percentage point; and
c.    Vegetables, tubers, plantains, cooking bananas and pulses, with 14.1 percent share or 0.4 percentage point.

TECHNICAL NOTES

The Philippine Statistics Authority generates and announces the monthly Consumer Price Index (CPI) based on a nationwide survey of prices for a given basket of goods and services. Two important indicators, the inflation rate and purchasing power of the peso (PPP), are derived from the CPI which are important in monitoring price stability and the value of the country’s currency.  

The CPI is an indicator of the change in the average retail prices of a fixed basket of goods and services commonly purchased by households relative to a base year.

Retail Price is the price at which a commodity is sold for spot in small quantities for consumption.

Base Period/Base Year is the period, usually a year, at which the index number is set to 100. It is the reference point of the index number series.

Market Basket is a term used to refer to a sample of goods and services that are commonly purchased and bought by an average Filipino household.

Weight is a value attached to a commodity or ground of commodities to indicate the relative importance of that commodity or group of commodities in the market basket.

Inflation Rate is equivalent to a decline in the purchasing power of the peso. It is the change in the CPI over a specific period of time (usually a month or a year). That is, 

where: 
CPI₁ - is the CPI in the previous period 
CPI₂ - is the CPI in the current period

The Purchasing Power of the Peso (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 CPI and multiplying the result by 100. That is, 

Headline Inflation is the rate of change in the weighted average prices of all goods and services in the CPI basket. 

Approved by:

MELCHOR B. BAUTISTA
Chief Statistical Specialist

KST/MLA/MJDG