A. The Philippines
The country’s inflation rate for the bottom 30% income households increased to 5.5 percent in June 2024 from 5.3 percent in May 2024. This brings the average inflation for this income group from January to June 2024 to 4.8 percent. In June 2023, inflation rate was posted at 6.1 percent. (Table A)
B. Central Visayas
1. Regional Inflation
Following the trend at the national level, inflation rate for the bottom 30% income households in Central Visayas increased to 7.0 percent in June 2024 from 5.7 percent in May 2024. The region’s average inflation for this income group from January to June 2024 stood at 4.2 percent. In June 2023, the inflation rate in the region was higher which recorded at 7.1 percent. (Table A)
C. City of Cebu
1. Headline Inflation
The headline inflation rate for the bottom 30% income households in the City of Cebu had a faster increase of 7.4 percent in June 2024 from 6.6 percent in May 2024. This brings the city’s average inflation at 5.3 percent from January to June 2024. In June 2023, the inflation rate was recorded 1 .2 percent. (Table A and Figure 1)
1.1 Main Drivers to the Upward Trend of Headline Inflation in the City of Cebu
The main source to the upward trend of the headline inflation rate for this income group in June 2024 were the faster annual increases of housing, water, electricity, gas and other fuels at 10.8 percent, and food and non-alcoholic beverages at 9.4 percent from their respective inflation rates at 6.4 percent and 9.3 percent in May 2024. (Table 3)
In contrast, slower year-on-year increases were recorded in the indices of the following commodity group during the month:
a. Alcoholic beverages and tobacco, 3.4 percent from 3.8 percent;
b. Clothing and footwear, 1.5 percent from 2.3 percent;
c. Transport, 3.8 percent from 4.5 percent; and
d. Personal care, and miscellaneous goods and services, 5.2 percent from 5.5 percent. (Table 3)
Moreover, the indices of commodity groups that retained their previous month’s inflation were as follows:
a. Furnishing, household equipment and routine household maintenance, 3.9 percent;
b. Health, 3.3 percent;
c. Information and communication, 0.0 percent;
d. Recreation, sport and culture, 18.1 percent;
e. Education services, 4.2 percent;
f. Restaurants and accommodation services, 2.1 percent; and
g. Financial services, 0.0 percent. (Table 3)
1.2 Main Contributors to the Headline Inflation
The following commodity groups were the top three contributors to the June 2024 overall inflation for the bottom 30% income households in the City of Cebu:
a. Food and non-alcoholic beverages with 58.1 percent share or 4.3 percentage points;
b. Housing, water, electricity, gas and other fuels with 28.6 percent share or 2.1 percentage points; and
c. Restaurants and accommodation services with 3.9 percent share or 0.3 percentage point.
2. Food Inflation
Food inflation rate for the bottom 30% income households in the City of Cebu had a faster increase at 10.0 percent in June 2024 from 9.9 percent in the previous month. In June 2023, the food inflation was lower at 3.4 percent. (Table 7)
2.1 Main Drivers to the Uptrend of Food Inflation
The uptrend in the food inflation during the month was primarily driven by the faster annual increase in the indices of vegetables, tubers, plantains, cooking bananas and pulses at 51.5 percent, meat and other parts of slaughtered land animals at 6.6 percent, and corn at 18.8 percent from their respective inflation rates at 38.1 percent, 5.5 percent, and 15.6 percent in May 2024. (Table 5)
In addition, a faster annual increment of 6.9 percent was also observed during the month in ready-made food and other food products index from 5.6 percent, while slower year-on-year decrease in sugar, confectionary and desserts at 2.5 percent from 2.7 percent annual drop in May 2024 were also contributed in the acceleration of the food inflation. (Table 5)
On the contrary, slower annual increases were noted in the indices of the following food groups during the month:
a. Flour, bread and other bakery products, pasta products, and other cereals, 2.8 percent from 3.0 percent;
b. Fish and other seafood, 0.1 percent from 3.4 percent;
c. Milk, other dairy products and eggs, 5.2 percent from 6.5 percent; and
d. Fruits and nuts, 9.7 percent from 12.8 percent. (Table 5)
Meanwhile, the indices of oils and fats, and rice retained their previous month’s inflation rates at -2.5 percent and 16.6 percent respectively. (Table 5)
2.2 Main Contributors to the Food Inflation
Food inflation contributed 56.6 percent or 4.2 percentage points to the June 2024 overall inflation for this particular income group.
Among the food groups, the main contributors to the food inflation during the month were the following:
a. Cereals and cereal products, which includes rice, corn, flour, bread and other bakery products, pasta products, and other cereals with 58.9 percent share or 5.9 percentage points;
b. Vegetables, tubers, plantains, cooking bananas and pulses with 24.3 percent share or 2.4 percentage point; and
c. Meat and other parts of slaughtered land animals with 9.0 percent share or 0.9 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
LGCS/MJDG
