CITY OF DAVAO

In November 2022, the annual headline inflation rate of Davao City slid to 10.0 percent, down from 10.4 in October. However, the inflation was 5.7 percent more than the inflation rate for the same month in 2021, which was only 4.3 percent, making it the second-highest inflation rate of the city since January 2019. (Table A and Figure 1).

The deceleration of the inflation rate in the city in November 2022 was mainly brought about by the decrease in inflation in Food and Non-Alcoholic Beverages and Transport. Specifically, there was a decrease of 1.7 percentage points in Food and Non-Alcoholic Beverages at 12.2 percent in November 2022, down from 13.9 percent in October 2022. Transport, on the other hand, decreased by 1.5 percentage points at 16.9 percent in November, down from 18.4 in the previous month.

While a decline in the city’s inflation rate has been observed for November 2022, most of the commodities were noted to have higher rates. These are:

1. Alcoholic Beverages and Tobacco, 15.6 percent;
2. Clothing and Footwear, 7.7 percent;
3. Furnishings, Household Equipment and Routine Household Maintenance, 9.0 percent;
4. Health, 4.9 percent;
5. Information and Communication, 1.0 percent;
6. Recreation, Sport and Culture, 5.8 percent;
7. Restaurants and Accommodation Services. 9.3 percent; and
8. Personal Care, and Miscellaneous Goods and Services, 9.0 percent.

The inflation rate of the rest of the commodity groups, on the other hand, remained the same. Specifically, Housing, Water, Electricity, Gas, and Other Fuels at 5.6 percent, Education Services at 9.8 percent, and Financial Services at 0.0 percent.

Meanwhile, Food inflation in Davao City decreased from 14.2 in October to 12.2 percent in November 2022. It was mainly due to the decrease in inflation of Fish and Other Seafood at 8.0 percent, Vegetables, Tubers, Plantains, Cooking Bananas and Pulses at 12.7 percent and Meat and Other parts of Slaughtered Land Animals at 10.7 percent. Also, the following food groups exhibited lower inflation rates:

1. Ready-made Food and Other Food Products n.e.c., 8.8 percent;
2. Milk, other Dairy Products and Eggs, 11.9 percent; and
3. Corn, 48.9 percent.

The rest of the food groups, despite the decreasing food inflation in the city, increased in November 2022, specifically Rice at 10.2 percent, Flour Bread and Other Bakery Products, Pasta Products, and Other Cereals at 10.9 percent, Oils and Fats at 31.2 percent, Fruits and Nuts at 18.2 percent and Sugar, Confectionery and Desserts at 44.1 percent.

In addition, the November 2022 Purchasing Power of Peso (PPP) in Davao City decreased to 0.83 from 0.84 in the previous month. PPP in November 2021 was at 0.92. (Figure 2).

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.