The headline inflation in Davao del Norte decreased by 1.6 percentage points in May 2023 (3.1%) compared to its inflation rate in the same month last year, which was recorded at 4.7 percent. The current inflation rate (3.1%) of the province is lower compared to the headline inflation of the Philippines and Davao Region, which stood at 6.1 percent and 6.3 percent, respectively (Table A).

The average inflation of Davao del Norte for the year 2023 stood at 5.3 percent (Table B).

2.  Contribution to the Inflation

Table C showed that the May 2023 inflation of Davao del Norte is mostly contributed by the indices of food and non-alcoholic beverages (6.1%); health (8.4%); and personal care, and miscellaneous goods and services (3.6%). 

3.    Share to the Trend of Inflation

The decrement in the inflation rate of Davao del Norte can be observed with its downward trend from 4.2 percent in April 2023 to 3.1 percent in May 2023. This decrease is mainly contributed by the downward movement of the index for food and non-alcoholic beverages, from a rate of 7.2 percent in April 2023 to 6.1 percent in May 2023. This is followed by the indices of housing, water, electricity, gas and other fuels (from 0.7% to -1.0%), and transport (from 0.5% to -1.9%). (Table D).

Despite the decrease of inflation rate in the province, an upward trend in May 2023 compared to their corresponding rates in April 2023 were observed in Table D for the following commodities:

·      Alcoholic beverages and tobacco (from 4.7% to 5.8%);

·      Furnishings, household equipment and routine household maintenance (from 3.0% to 3.3%); and

·      Recreation, sport and culture (from 5.9% to 6.1%).

It can also be observed that the commodities for clothing and footwear; information and communication; education services; restaurants and accommodation services; financial services; and personal care, and miscellaneous goods and services has shown no sign of increase nor decrease in inflation rate in comparison to their corresponding rates last month.

The index for food has also shown a downward trend from 7.2 percent in April 2023 to 6.1 percent in May 2023. The downtrend of the food inflation was mostly attributed by the lower annual increase in the price indices of fish and other seafood; corn; and meat and other parts of slaughtered land animals (Table E.) 

4.  Purchasing Power of Peso

The Purchasing Power of Peso (PPP) measures the current value of the peso in reference to its value in the base year. It has an inverse relationship with the Cosumer Price Index (CPI), which means that if the CPI increases, the PPP decreases.

Figure 2 showed that the PPP for the province of Davao del Norte increased and was recorded at 0.86 compared to the recorded PPP of 0.85 in April 2023. This suggests that Php100.00 in 2018 is currently valued at PhP86.00.