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.
Table A. Year-on-Year Inflation Rates, All Items
In Percent
(2018=100)
Area | May | April | May | Year-to-date* |
2023 | 2024 | 2024 | ||
Philippines | 6.1 | 3.8 | 3.9 | 3.5 |
Central Visayas | 5.4 | 3.2 | 4.0 | 3.1 |
Bohol | 7.1 | 4.3 | 5.1 | 4.1 |
Cebu | 5.4 | 0.2 | 2.3 | 0.4 |
Negros Oriental | 7.3 | 4.7 | 3.6 | 4.7 |
Siquijor | 6.9 | 3.8 | 3.8 | 3.8 |
Cebu City | 4.1 | 4.6 | 5.7 | 4.8 |
Lapu-Lapu City | 3.1 | 5.5 | 5.8 | 4.8 |
Mandaue City | 2.7 | 7.6 | 7.3 | 7.0 |
Source: Philippine Statistics Authority
*Year-on-year change of CPI for April to May 2024 vs. 2023
A. The Philippines
The Philippines’ headline inflation or overall inflation increased to 3.9 percent in May 2024 from 3.8 percent in April 2024. This brings the national average inflation from January to May 2024 to 3.5 percent. In May 2023, inflation rate was higher at 6.1 percent. (Table A)
By Region
Relative to their respective May 2024 inflation rates, six regions had higher inflation rates in May 2024. On the contrary, eight regions recorded lower inflation rates during the month, while the remaining three regions, Region V (Bicol Region), Region VIII (Eastern Visayas Region) and Region XIII (Caraga Region) maintained its rate as in the previous month. Bangsamoro Administrative Region in Muslim Mindanao (BARMM) had the highest inflation rate during the month at 5.9 percent, while Region I (Ilocos Region) had the lowest inflation rate at 2.3 percent. (Figure 1)
B. Central Visayas
1. Regional Inflation
The Central Visayas’ headline or overall inflation increased to 4.0 percent in May 2024 from 3.2 percent in April 2024. This brings the regional average inflation from January 2024 to May 2024 at 3.1 percent. In May 2023, inflation rate was higher at 5.4 percent. (Table A, B, and Figure 2)
1.1 Main Drivers to the Upward Trend of the Headline Inflation
The uptrend in the overall inflation in May 2024 was primarily influenced by the higher year-on-year increase in the heavily-weighted food and non-alcoholic beverages at 6.4 percent during the month from 5.0 percent in April 2024. The faster annual growth of the transport index at 2.3 percent in May 2024 from 1.4 percent annual decline in April 2024 also contributed to the uptrend of the overall inflation of the region.
In addition, faster annual increments were posted during the month in the indices of housing, water, electricity, gas and other fuels at 1.6 percent from 1.1 percent in April 2024, and furnishings, household equipment and routine household maintenance at 2.8 percent from 2.7 percent in the previous month.
In contrast, slower annual growth rates were noted in the indices of the following commodity groups during the month:
a. Alcoholic Beverages and Tobacco, 6.1 percent from 8.4 percent;
b. Health, 4.2 percent from 4.3 percent; and
c. Personal Care, And Miscellaneous Goods and Services, 4.3 percent from 4.4 percent.
The indices of the rest of the commodity groups retained their respective previous month’s annual rates. (Table 3)
1.2 Main Contributors to the Regional Inflation
The top three commodity groups contributing to the overall regional inflation in
April 2024 were the following:
a. Food and Non-Alcoholic Beverages with 60.1 percent share or 2.4 percentage points;
b. Restaurants and Accommodation Services with 9.4 percent share or 0.4 percentage point; and
c. Housing, Water, Electricity, Gas and Other Fuels with 9.3 percent share or 0.4 percentage point.
2. Food Inflation
Food inflation at the regional level rose to 6.7 percent in May 2024 from 5.2 percent in April 2024. In May 2023, food inflation was lower at 6.5 percent. (Table 7)
2.1 Main Drivers to the Upward Trend of Food Inflation
The acceleration of food inflation in May 2024 was mainly brought about by the faster year-on-year increase in the index of cereals and cereal products, which includes rice, corn, flour, bread and other bakery products, pasta products, and other cereals at 12.3 percent in May 2024 from 9.5 percent in the previous month. This was followed by the index of vegetables, tubers, plantains, cooking bananas and pulses with an inflation rate of 11.4 percent during the month from 1.7 percent in April 2024.
In addition, the index of meat and other parts of slaughtered land animals contributed to the uptrend as it recorded a faster annual increase of 6.8 percent during the month from 6.5 percent in April 2024. (Table 5)
Faster annual increases during the month were also noted in the indices of ready-made food and other food products n.e.c. at 7.5 percent from 7.4 percent, and oils and fats at 0.4 percent from 0.3 percent in previous month. (Table 5)
On the contrary, slower annual increases during the month were observed in the indices of the following food groups: (Table 5)
a. Milk, Other Dairy Products, and Eggs, 4.7 percent from 6.3 percent; and
b. Fruits and nuts, 3.1 percent from 6.6 percent.
Meanwhile, faster annual decreases during the month were noted in the indices of sugar, confectionery and desserts at 5.2 percent annual decline from 4.9 percent annual decline in April 2024 and fish and other seafood at annual decline of 2.2 percent from 2.1 percent annual decrease in April 2024. (Table 5)
2.2 Main Contributors to the Food Inflation
Food shared 58.1 percent or 2.3 percentage points to the overall inflation in May 2024. The top three food groups in terms of contribution 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 68.5 percent share or 4.6 percentage points;
b. Meat and other parts of slaughtered land animals with 15.7 percent share or 1.1 percentage point; and
c. Vegetables, tubers, plantains, cooking bananas and pulses with 11.1 percent share or 0.7 percentage point.
C. By Province
Among the provinces and Highly Urbanized Cities (HUCs) of Central Visayas, Province of Cebu recorded the lowest inflation in May 2024 at 2.3 percent while City of Mandaue recorded the highest inflation during the month at 7.3 percent.
Moreover, two provinces and two HUCs recorded faster year-on-year increases this month compared to the previous month’s inflation rates while Province of Negros Oriental and City of Mandaue registered a slower annual increment during the month relative to its respective April 2024 inflation rates. Meanwhile, Province of Siquior retained its previous month's rate. (Table A, Figure 3).
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
