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.
1. The Philippines
Headline inflation or the overall inflation in the Philippines slowed down further to 6.6 percent in April 2023 from 7.6 percent in March 2023. The inflation rate in April 2022 was observed at 4.9 percent. This brings the average inflation rate from January to April 2023 to 7.9 percent. (Table A)
2. Central Visayas
Following the trend at the national level, inflation rate in Central Visayas slowed down further to 5.5 percent in April 2023 from 6.6 percent in March. In April of the previous year, inflation rate in the region was recorded at 5.4 percent. (Table A, B and Figure 1)
Main Drivers to the Downward Trend of the Regional Inflation
Among the 13 commodity groups, the downtrend of the overall inflation in April 2023 was mainly brought about by Transport, which recorded a lower inflation rate of -1.7 percent from 4.0 percent in the previous month. Food and Non-alcoholic Beverages was the second top contributor with an inflation rate of 7.1 percent from 8.2 percent in the previous month. (Table 3)
On the contrary, higher inflation rates were observed in the following commodity groups during the month: (Table 3)
a. Alcoholic Beverages and Tobacco, 12.0 percent from 11.3 percent;
b. Clothing and Footwear, 3.3 percent from 3.1 percent;
c. Furnishings, Household Equipment and Routine Household Maintenance, 4.8 percent from 4.6 percent;
d. Health, 3.6 percent from 3.4 percent;
e. Restaurants and Accommodation Services; 6.1 percent from 6.0 percent; and
f. Personal Care, and Miscellaneous Goods and Services, 4.0 percent from 3.9 percent.
The indices of the following commodity groups retained their corresponding previous month’s annual increments: (Table 3)
a. Housing, Water, Electricity, Gas and Other Fuels, 7.3 percent;
b. Information and Communication, 1.2 percent;
c. Recreation, Sport and Culture, 2.2 percent;
d. Education Services, 5.9 percent; and
e. Financial Services, 0.0 percent.
Main Contributors to the Regional Inflation
The top three commodity groups contributing to the April 2023 overall inflation of 5.5 percent were the following:
a. Food and Non-Alcoholic Beverages with 47.5 percent share or 2.6 percentage points;
b. Housing, Water, Electricity, Gas and Other Fuels at 30.1 percent share or 1.7 percentage points; and
c. Restaurants and Accommodation Services at 9.5 percent share or 0.5 percentage point.
Food Inflation
Food inflation at the regional level slowed down further to 6.9 percent in April 2023 from 8.2 percent in March 2023. In March 2022, food inflation was lower at 6.7 percent. (Table 7)
Main Drivers to the Downward Trend of Food Inflation
The primary driver of slower food inflation was the lower annual growth in the index of Fish and Other Seafood at 5.4 percent in April 2023 from 11.0 percent in March 2023. This was followed by Vegetables, Tubers, Plantains, Cooking Bananas and Pulses with an annual increment of 12.6 percent during the month from 19.4 percent in the previous month. Sugar, Confectionery and Desserts ranked third, recording 40.7 percent inflation during the month from 41.9 percent in the previous month. (Table 5)
Lower inflation rates during the month were also noted in the indices of the following food items: (Table 5)
a. Corn, -1.9 percent from 3.3 percent; and
b. Oils and Fats, 24.2 percent from 26.0 percent.
Meanwhile, compared with their previous month’s inflation rates, higher year-on-year growth rates were observed in the indices of the following food groups during the month: (Table 5)
a. Rice, 3.4 percent from 1.2 percent;
b. Flour, Bread and Other Bakery Products, Pasta Products, and Other Cereals, 12.2 percent from 11.7 percent;
c. Meat and Other Parts of Slaughtered Land Animals, 5.1 percent from 3.7 percent;
d. Milk, Other Dairy Products and Eggs, 8.0 percent from 7.7 percent; and
e. Ready-made Food and Other Food Products not elsewhere classified, 8.4 percent from 8.3 percent.
The indices for Fruits and Nuts retained their previous months annual increment at 12.2 percent.
Main Contributors to the Food Inflation
In terms of contribution to the April 2023 headline inflation, food shared 43.4 percent share or 2.4 percentage points. Of the food groups, the top contributors to food inflation were the following:
a. Cereals and Cereal products which includes rice, corn, flour, bread and other bakery products with 20.9 percent share or 1.4 percentage points;
b. Sugar, Confectionery and Desserts with 14.3 percent share or 1.0 percentage point; and
Fish and other seafood with 13.6 percent share or 0.9 percentage point.
3. By Province
Comparing with the respective previous month’s annual rates of the provinces and Highly Urbanized Cities (HUCs) of Central Visayas, all provinces and HUCs, except the Province of Negros Oriental and City of Cebu, recorded slower inflation rates during the month. (Figure 2)
Among the provinces, the Province of Cebu registered the lowest inflation rate at 5.8 percent during the month, while Siquijor remained as the province with the highest inflation for three consecutive months with an inflation rate of 8.1 percent in April 2023. (Figure 2)
Further, City of Lapu-Lapu and City of Mandaue posted lower inflation in April 2023 at 4.2 percent and 2.4 percent, respectively, while the City of Cebu retained its previous month’s annual increment at 4.3 percent. (Figure 2)
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:
(SGD.) ARIEL E. FLORENDO
Regional Director
