The Davao Occidental headline inflation increased to 5.1 percent in December 2023 from 4.5 percent in November 2023. The provincial average inflation from January to December 2023 stood at 5.5 percent. In December 2022, the inflation rate was higher at 9.2 percent. (Table A and Figure 1)

The main source of the upward trend of the December 2023 inflation rate was mainly brought about by the higher annual growth rate in the housing, water, electricity, gas, and other fuels index to negative 6.9 percent from negative 13.5 percent in the previous month.

In contrast, lower annual inflation was noted in the indices of the following commodity groups during the month:
a. Alcohol beverages and tobacco 17.1 percent from 17.5 percent.
b. Food and non-alcoholic beverages, 9.1 percent from 10.1 percent;
c. Furnishing, household equipment and routine, 2.0 percent from 2.1 percent; and
d. Transport, 0.1 percent from 0.6 percent.

On the other hand, clothing and footwear, health, information and communication, recreation, sport and culture, education services, and restaurants and accommodation services retained its inflation with the previous months at 4.5 percent, 0.8 percent, 0.4 percent, 7.6 percent, 3.7 percent, and 10.8 percent, respectively. While the financial services and personal care, and miscellaneous goods and services remained at zero growth during the month. (Tables B)

The food inflation at the provincial level dropped to 9.3 percent in December 2023 from 10.3 percent in the previous month. In December 2022, the food inflation was higher at 12.0 percent.

The down trend inflation of food in December 2023 was mainly brought by lower inflation of milk, other dairy products, and eggs, with inflation rate of 15.0 percent from 16.4 percent in November 2023.

The following commodity group also contributed the deceleration of food;
a. Fish and other seafood products from 2.3 percent to 1.3 percent; 
b. Meat and other parts of slaughtered land animals from 3.5 percent to 1.2 percent;
c. Vegetables, tubers, plantains, cooking bananas and pulses from -2.1 percent to -6.6 percent;
d. Sugar, confectionery, and desserts from -6.6 percent to -9.2 percent; and
e. Oils and Fats from -27.9 percent to -29.3 percent.

On the other hand, cereals and cereal products had increased its inflation to 22.2 percent from 21.8 percent. (Table C)

In addition, the December 2023 Purchasing Power of Peso (PPP) in Davao Occidental eased to 0.81. (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.