The headline inflation of prices in Davao de Oro decreased to 4.8 percent in August 2024 from 5.6 percent in July 2024, or a decrease of 0.8 percentage points. lnflation of prices in August 2023 was lower at 3.6 percent. The average inflation for the year 2024 stood at 4.5 percent. (Table I and Figure
1)

The decrease in the province's inflation was mainly brought about by the downtrend annual rate in the index of Food and non-alcoholic beverages which decreased to 6.1 percent from 9.5 percent in July 2024; Transport which decreased to -2.0 percent from 2.7 percent in July 2024 and; Health which decreased to 1.4 percent from 6.3 percent in July 2024.

The percentage share of the above-mentioned commodity groups to the downtrend of the Augusl2024 inflation are as follows; (a) Food and nonalcoholic beverages with 71 .7 percent; (b) Transport with 16.3 percent and; (c) Health with 4.6 percent.

The following commodity groups posted a downtrend in the overall inflation for the month of August 2024 and are the following:
a. Food and non-alcoholic beverages with 6.1 percent;
b. Clothing and footwear with 3.5 percent;
c. Furnishing, household equipment and routine with 3.8 percent;
d. Health with 1.4 percent;
e. Transport with -2.0 percent;
f. lnformation and communication with -0.3 percent;
g. Recreation, sport and culture with 3.7 percent;
h. Education Services with 0.7 percent and;
i. Personal care, and miscellaneous goods and services with 1.4
percent.

On the other hand, the housing, water, electricity, gas and other fuels commodity group posted an uptrend in the overall inflation with 6.8 percent inflation rate.

Meanwhile, the following commodity groups retained their inflation rate from July 2024 to August 2024:
a) Alcoholic beverages and tobacco with 1.5 percent;
b) Restaurant and accommodation services with 8.2 percent and;
c) Financial Services with 0 percent.

Food and non-alcoholic beverages group shared the highest contribution for the month's inflation rate with 63.5 percent share (3.1 points). As to the share to the month's inflation rate of the said commodity group, Cereals and cereal products posted the highest percent share having a 9.7 percent inflation rate, followed by Vegetables, tubers, plantains, cooking bananas and pulses with 17.0 percent inflation rate, and Milk, other dairy products and eggs with 7.0 percent inflation rate. (Table 3)

The second highest contributor for the August 2024 inflalion rate is the housing, water, electricity, gas and other fuels commodity group having a 24.8 percent share (1.2 points) among all items. Under this group, Electricity posted the highest share with 31.2 percent inflation rate, followed by Gas with 14.6 percent inflation rate, and Actual rentals paid by tenants for main residence with 1.0 percent inflation rate. (Table 4)

Restaurant and accommodation services commodity group ranked third with a 7.0 percent contribution (0.3 point) for the August 2024 inflation. (Table 5)
 

Below is the summary of inflation rates in Davao de Oro Province since the rebasing of market basket with year 2018 as the base year.
 

Consequently, the Purchasing Power of Peso (PPP) based on year 2018 in Davao de Oro is equivalent to 0.76 in August 2024. (Figure 2)

Technical Notes

Price - is the amount or value paid in exchange for the commodity or a service rendered.

Retail/Consumer Price - refers to the price at which a commodity is sold in small quantities for consumption.

Market Basket - a term used to refer to a sample of goods and services that are commonly purchased and bought by an average Filipino household.

Consumer Price lndex (CPl) - it is an indicator of the change in the average retail prices of a fixed basket of goods and services commonly purchased by an average Filipino household. lt shows how much on the average, prices of goods and services have increased or decreased from a particular reference period known as base year.

lnflation Rate - is an indicator derived from the CPl. lt refers to the annual rate of change or the year-on-year change of the CPI expressed in percent. lnflation is interpreted in terms of declining purchasing power of money.

Weight - a value attached to a commodity or group of commodities depending on the magnitude of its contribution to the index.

Base Period - a reference date atwhich the index is equal to 100. Base year is 2018.

lndex Methodology - a Laspeyre's formula: fixed base year and weights.

Purchasing Power of the Peso (PPP) - the measure of how much the peso in the base period is worth in the current period.

Percentage Change - is a simple mathematical concept that represents the degree of change over time. lt is used for many purposes in finance, often to represent the price change of a security.

Headline lnflation - measures changes in the cost of living based on movements in the prices of a specified basket of major commodities. lt refers to the annual rate of change or the year-on-year change in the Consumer Price lndex (CPl).