The inflation rate for the bottom 30% income households in the province further decelerated to 2.9 percent in August 2024 from 5.0 percent in July 2024. This brings the average inflation for this income group from January to August 2024 to 5.8 percent. In August 2023, inflation rate was higher at 6.6 percent. (Tables A and B, and Figure 1) 

The overall inflation downtrend for this income group in August 2024 was mainly driven by the slower annual increase in food and non-alcoholic beverages, which dropped to 4.9 percent from 7.4 percent in July 2024. Additionally, the inflation rate for transport significantly declined, registering a decrease of -2.6 percent from 4.1 percent in the previous month. 

Additionally, lower annual increments were noted in the indices of the following commodity groups during the month: 

a. Personal care, and miscellaneous goods and services, 3.1 percent from 4.8 percent; 

b. Housing, water, electricity, gas, and other fuels, -4.2 percent from  -3.9 percent; 

c. Education services, 5.1 percent from 11.0 percent;

d. Recreation, sport and culture, 12.3 percent from 13.4 percent; 

e. Furnishings, household equipment and routine household maintenance, 3.3 percent from 3.7 percent; 

f. Clothing and footwear, 2.3 percent from 2.7 percent; 

g. Health, 3.3 percent from 3.4 percent; and h. Alcoholic beverages and tobacco, 1.0 percent from 1.1 percent.

On the contrary, the index of information and communication exhibited a higher annual increase of 1.1 percent during the month from 0.0 percent in July 2024. The indices of the rest of the commodity groups retained their respective previous month’s annual rates. (Tables C)     

Food inflation at the provincial level slowed down to 5.1 percent in August 2024 from 7.9 percent in July 2024. In August 2023, food inflation was higher at 10.2 percent. (Table D) 

The deceleration of food inflation in August 2024 was primarily driven by the slower year-on-year increase in the rice index, which eased to 20.1 percent from 25.2 percent in the previous month. Fish and other seafood also contributed to the overall decline with an inflation rate of -11.3 percent from -6.3 percent in July 2024.

 Moreover, slower annual rates were noted in the indices of the following food groups during the month:

a. Meat and other parts of slaughtered land animals, -5.0 percent from -3.1 percent; 

b. Corn, 20.0 percent from 21.3 percent; 

c. Fruits and nuts, -7.7 percent from -4.4 percent; 

d. Vegetables, tubers, plantains, cooking bananas and pulses,     22.7 percent from 22.8 percent; and 

e. Flour, bread and other bakery products, pasta products, and other cereals, 1.8 percent from 2.4 percent.

In contrast, higher annual growth rates were noted in the indices of the following food groups: 

a. Milk, other dairy products and eggs, -4.8 percent from -7.0 percent; 

b. Oils and fats, 5.7 percent from -0.2 percent;     

c. Sugar, confectionery and desserts, -16.5 percent from  -16.9 percent; and 

d. Ready-made food and other food products N.E.C., 8.7 percent from 8.5 percent. (Table D)

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

 (Supervising Statistical Specialist) 

Officer-in-Charge