CITY OF DAVAO

1.    Headline Inflation

In May 2025, the headline inflation rate in Davao City decreased to 1.4 percent, reflecting a 0.5 percentage points decrease from April 2024 rate of 1.9 percent. Notably, the current inflation rate was 3.3 percentage points lower than the figure reported in May 2024 at 4.7 percent. (Table A and Figure 1).

1.1 Main Drivers Contributing to the Headline Inflation 

Among the major commodity groups, the lower headline inflation in May 2025 was primarily brought about by the decrease in the index of a) Housing, Water, Electricity, Gas, and Other Fuels at negative 1.2 percent, from 1.5 percent in the previous month. Also contributing to the city’s decreasing trend of headline inflation was b) Furnishings, Household Equipment, and Routine Household Maintenance at 2.9 percent, from 3.1 percent in April 2024. The third major contributor to the decreased inflation was c) Clothing and Footwear at 2.3 percent, from 2.4 percent in the last month.

On the other hand, an increasing movement of prices was observed in the city of the following commodity groups:

a)    Food and Non-Alcoholic Beverages at 2.7 percent, from 2.6 percent in the previous month; 
b)    Alcoholic Beverages and Tobacco at 4.4 percent, from 4.2 percent in the previous month; 
c)    Transport at negative 3.5 percent, from negative 3.6 percent in the previous month; 
d)    Recreation, Sport, and Culture at 5.5 percent from 5.3 percent in the previous month; and 
e)    Personal Care, and Miscellaneous Goods and Services at 4.4 percent from 4.1 percent previous month.

Meanwhile, Health at 2.8 percent, Information and Communication at 0.3 percent, Education Services at 11.4 percent, Restaurants and Accommodation Services at 2.0 percent, and Financial Services at 0.0 percent retained the previous month’s inflation rate.

2.    Food Inflation

Meanwhile, the city’s food inflation remained at 2.5 percent in May 2025, the same rate level in April 2025. The steady food inflation rate was mainly due to the combination of slower, faster, and unchanged movements in the inflation rates of various food commodity groups, particularly:

a)    Meat and other parts of slaughtered land animals at 6.9 percent, from 5.8 percent in the previous month;
b)    Fish and other seafood at 8.2 percent, from 10.2 percent in the previous month; and
c)    Milk, other dairy products, and eggs at 5.0 percent, from 4.4 percent in the previous month.

Moreover, lower inflation rates during the month were observed in Ready-made food and other food products at 7.0 percent, from 7.6 percent, and Vegetables, tubers, plantains, cooking bananas and pulses at 0.9 percent, from 2.8 percent in the previous month.

In contrast, higher inflation rates were observed in the following food groups:
a)    Fruits and nuts at 6.4 percent, from 4.0 percent in the previous month;
b)    Oils and fats at 5.3 percent, from 2.5 percent in the previous month; and
c)    Sugar, Confectionery, and Desserts at 1.2 percent, from 0.9 percent in the previous month.

Meanwhile, Cereals and cereal products at negative 4.7 percent retained its previous month’s inflation rate.

3.    Purchasing Power of Peso

The Purchasing Power of Peso (PPP) in Davao City for May 2025 remained unchanged at 0.76, same as the previous month’s PPP, as presented in Figure 2. This translates that to purchase the same set of goods and services that cost Php100.00 in 2018, one would require Php131.3 in May 2025.
 

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:

ADELINE G. BATUCAN
(Supervising Statistical Specialist)
Officer-In-Charge
Davao del Sur Provincial Statistical Office