CITY OF DAVAO

1. Headline Inflation

In November 2023, the City of Davao underwent a decrease in headline inflation to 6.3 percent, reflecting a 0.3 percent decline from the October 2023 rate of 6.6 percent. Notably, the current inflation rate was 3.7 percentage points lower than the figure reported in November 2022. Meanwhile, the city's average inflation rate from January to November 2023 stands at 7.7 percent (Table A and Figure 1).

1.1 Main Drivers contributing to the decline in Headline Inflation

Among the 13 commodity groups, the lower headline inflation in November 2023 was primarily brought about by the decrease in the index of (a) Restaurants and Accommodation Services at 13.6 percent, down from 14.9 percent in the previous month. Also contributing to the trend of the headline inflation in the city was (b) Housing, Water, Electricity, Gas and other Fuels at 2.2 percent, down from 2.7 percent in the previous month. The third commodity group with the largest contribution to the decreasing trend was (c) Alcoholic Beverages and Tobacco at 12.6 percent, which decreased from 15.6 percent in the previous month.

Relative to their annual rates in the previous month, lower year-on-year inflation rates were also observed in the following commodity groups: 

a) Clothing and Footwear, 6.4 percent;

b) Furnishings, Household Equipment and Routing Household Maintenance, 5.2 percent; 

c) Health, 5.8 percent;

d) Information and Communication, 1.1 percent;

e) Recreation, Sport and Culture, 3.7 percent;

f) Restaurants and Accommodation Services, 13.6 percent;

g) Personal Care, and Miscellaneous Goods and Services, 7.0 percent.

In contrast, two of commodity groups had higher inflation rate in November 2023. Specifically, a) Food and Non-Alcoholic Beverages at 8.4 percent, up from 8.3 in the previous month, and b) Transport at 0.4 percent, up from -0.1 percent in the previous month. The rest of the commodities, on the other hand, remained equal.

2. Food Inflation

Meanwhile, food inflation increased to 8.1 percent in November 2023 from 7.9 percent in the previous month. The increase was mainly due to a) Fish and other seafood at -5.9 percent, from -7.9 percent in the previous month. This was followed by b) Cereals and cereal products at 17.7 percent, up from 16.8 percent in the previous month; and c) Vegetables, tubers, plantains, cooking bananas and pulses at 4.7 percent, up from 0.0 percent in the previous 
month. Relative to their annual rates in the previous month, higher year-on-year inflation rates were also observed in the following commodity groups:

a. Milk, other diary products and eggs, 7.7 percent; and

b. Ready-made food and other food products n.e.c., 8.5 percent;

c. Rice, 21.8 percent.

The rest of the commodities, on the other hand, have decreasing rate.

3. Purchasing Power of Peso

The Purchasing Power of Peso (PPP) in Davao City continued its downward trend, decreasing to 0.78 in November 2023, compared to 0.79 in October 2023, as illustrated in Figure 2. This signifies that the value of Php 100 in 2018 is now equivalent to Php 78 in November 2023. Furthermore, to buy the same set of goods and services valued at Php 1000 in 2018, one would require Php 1276 pesos in November 2023.

Technical Notes:

Consumer Price Index (CPI) - 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.

Inflation Rate (IR) - The inflation rate is the annual rate of change, or the year-on-year change of the CPI expressed in percent. Inflation is interpreted in terms of declining purchasing power of money. 

Headline Inflation - measures changes in the cost of living based on movements in the prices of a specified basket of major commodities. It refers to the annual rate of change or the year on-year change in the Consumer Price Index (CPI).

Purchasing Power of the Peso (PPP) - The purchasing power of the peso shows how much the peso in the base period is worth in the current period. It is computed as the reciprocal of the CPI for the period under review multiplied by 100.

Approved for Release:

 

(SGD) ROGELIO T. LEBRIA
Chief Statistical Specialist
Davao del Sur Provincial Statistical Office