The overall inflation rate in Davao Oriental further declined to 1.6 percent in October 2024 from 2.3 percent in September 2024. This brings the provincial average inflation from January to October 2024 to 4.2 percent. In October 2023, the inflation rate was higher at 7.2 percent. (Tables A and B, and Figure 1)

The overall inflation downtrend in October 2024 was mainly driven by a slower annual increase in the food and non-alcoholic beverages index, which fell to 3.6 percent from 4.5 percent in the previous month. Housing, water, electricity, gas, and other fuels also contributed to the decline, with a sharper year-on-year decrease of -1.7 percent in October compared to 0.6 percent in September. Additionally, inflation for alcoholic beverages and tobacco eased to 1.9 percent from 2.0 percent in September. 

In contrast, the following commodity groups registered higher inflation rates during the month: 

a. Furnishings, household equipment and routine household maintenance, 2.4 percent from 2.3 percent; 

b. Health, 2.1 percent from 2.0 percent;

c. Transport, -6.7 percent from -7.4 percent; and 

d. Personal care, and miscellaneous goods and services, 2.6 percent from 2.4 percent.

 The indices of the rest of the commodity groups retained their respective previous month’s annual rates. (Tables C)     

At the provincial level, food inflation dropped to 3.8 percent in October 2024 from 4.7 percent in September. In October 2023, food inflation was notably higher at 8.4 percent. (Table D) 

The deceleration of food inflation was mainly due to the slower annual increase in the prices of rice, dropping to 9.0 percent during the month from 13.1 percent in the previous month. Additionally, corn recorded an inflation rate of 1.6 percent in October 2024, down from 15.1 percent in September 2024. 

Lower annual increments were also noted in the indices of the following food groups: 

a. Flour, Bread and other bakery products, pasta products, and other cereals, 1.8 percent form 1.9 percent; 

b. Vegetables, tubers, plantains, cooking bananas and pulses,         5.4 percent from 7.0 percent; and

 c. Ready-made food and other food products N.E.C., 3.9 percent from 6.3 percent.

In contrast, higher year-on-year growth rates were noted in the indices of the following food groups during the month: 

a. Fish and other seafood, 6.3 percent from 3.1 percent;   

b. Meat and other parts of slaughtered land animals, -1.7 percent from -2.1 percent; 

c. Milk, other dairy products and eggs, 1.2 percent from  -1.8 percent; 

d. Oils and fats, 6.6 percent form 6.5 percent; 

e. Fruits and nuts, 0.6 percent from -4.7 percent; and 

f. Sugar, confectionery and desserts, -11.0 percent   from -12.8 percent. (Table D)

In October 2024, all provinces in the Davao Region, including Davao City, had lower inflation than in September, except for Davao de Oro, which experienced higher inflation, and Davao del Norte, which remained unchanged. Davao del Norte continued to have the lowest inflation rate at   1.1 percent, while Davao del Sur recorded the highest at 4.3 percent. (Table E) 

Purchasing Power of the Peso (PPP)  

 The purchasing power of the peso (PPP) shows how much the peso in the base year (2018) is worth in another period. It is computed by getting the reciprocal of the CPI and multiplying the result by 100. The PPP in Davao Oriental remained at 0.77 as of October 2024, meaning that PhP1.00 in 2018 is equivalent to PhP0.77. In contrast, the PPP in October 2023 was slightly higher at 0.79. (Figure 2)

TECHNICAL NOTES

Uses of CPI 

The CPI is most widely used in the calculation of the inflation rate and purchasing power of peso. It is a major statistical series used for economic analysis and as a monitoring indicator of government economic policy. 

Computation of CPI 

The computation of the CPI involves consideration of the following important points: 

a. Base Year/Period - A period, usually a year, at which the index number is set to 100. It is the reference point of the index number series. 

b. Market Basket - A sample of the thousands of varieties of goods purchased for consumption and services availed by the households in the country selected to represent the composite price behavior of all goods and services purchased by consumers. 

c. Weighting System - The weighting pattern uses the expenditures on various consumer items purchased by households as a proportion to total expenditure. 

d. Formula - The formula used in computing the CPI is the weighted arithmetic mean of price relatives, the Laspeyre’s formula with a fixed base year period (2006) weights. 

e. Geographic Coverage - CPI values are computed at the national, regional, and provincial levels, and for selected cities.

 Note: CPIs and inflation rates by province and selected city are posted at the PSA website (https://openstat.psa.gov.ph/).

 Approved for release: 

EMILY P. TOMOGDAN

 Chief Statistical Specialist