Headline Inflation

The region’s headline inflation or overall inflation slowed down to 2.4 percent in December 2024 from 3.2 percent in November 2024. In December 2023, the inflation rate was higher at 4.9 percent.

Main Drivers to the Downward Trend of the Headline Inflation

The downtrend in the overall inflation in December 2024 was primarily influenced by the slower annual increment in the index of food and non-alcoholic beverages at 2.9 percent during the month from 4.4 percent in November 2024. Also contributing to the downtrend was housing, water, electricity, gas and other fuels with a slower year-on-year increase of 0.7 percent in December 2024 from 2.0 percent annual increment in the previous month.

Slower annual increments were also noted in the indices of the following commodity groups during the month:

a. Alcoholic beverages and tobacco, 2.5 percent from 2.6 percent;
b. Clothing and Footwear, 4.4 percent from 4.5 percent; and
c. Personal care, and miscellaneous goods and services, 3.5 percent from 3.9 percent.

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

a. Furnishings, household equipment and routine household maintenance, 4.3 percent from 3.9 percent; 
b. Health, 2.7 percent from 2.6 percent; 
c. Transport, 1.8 percent from 0.8 percent;
d. Restaurants and accommodation services, 1.3 percent from 1.1 percent.

The indices of the rest of the commodity groups retained their respective previous month’s inflation rates in December 2024.

Main Contributors to the Headline Inflation

The top three commodity groups contributing to the December 2024 overall inflation were the following:

     a. Food and non-alcoholic beverages with 55.3 percent share or 1.3 percentage points;
     b. Clothing and footwear with 6.4 percent share or 0.2 percentage point; and
     c. Personal care, and miscellaneous goods and services with 6.3 percent share or 0.2 percentage point.

Average Annual Inflation

The region’s annual average inflation rate for 2024 stood at 3.5 percent, which was lower than the 2023 annual average inflation rate of 5.9 percent.

Main Drivers to the Downward Trend of the 2024 Annual Average Inflation

The downtrend in the 2024 annual average inflation at the regional level was primarily caused by the lower annual average increase in the index of food and non-alcoholic beverages at 5.5 percent in 2024 from 7.9 percent annual average inflation in 2023. Also contributed to the downtrend was the annual decline of housing, water, electricity, gas and other fuels at -0.8 percent in 2024 from 3.1 percent annual average inflation in 2023.

Moreover, lower annual average increase was noted in the indices of the following:

     a. Alcoholic beverages and tobacco, 4.8 percent from 11.6 percent in 2023;
     b. Clothing and footwear, 4.6 percent from 8.2 percent in 2023;
     c. Furnishings, household equipment and routine household maintenance, 3.4 percent from 4.1 percent in 2023;
     d. Health, 1.9 percent from 3.0 percent in 2023;
     e. Recreation, sport and culture, 4.4 percent from 5.1 percent in 2023;
     f. Restaurants and accommodation services, 3.3 percent from 7.1 percent in 2023; and
     g. Personal care, and miscellaneous goods and services, 3.2 percent from 5.2 percent in 2023.

In contrast, higher annual average increase was observed in the index of the following:

     a. Transport, 2.9 percent from 1.7 percent in 2023;
     b. Information and communication, 3.3 percent from 2.0 percent; and
     c. Education services, 3.6 percent from 2.6 percent.

Financial services retained its annual growth rate at zero percent in 2024.

Main Contributors to the 2024 Annual Average Inflation

The top three commodity groups contributing to the 2024 annual average inflation were the following:
     a. Food and non-alcoholic beverages with 70.4 percent share or 2.5 percentage points;
     b. Restaurants and accommodation services with 6.0 percent share or 0.2 percentage point; and
     c. Transport with 5.9 percent share or 0.2 percentage point.

Food Inflation

Food inflation at the regional level decreased to 2.8 percent in December 2024 from 4.3 percent in the previous month. In December 2023, food inflation was higher at 8.4 percent.

Main Drivers to the Downward Trend of Food Inflation

The deceleration of food inflation in December 2024 was primarily brought about by the year-on-year decrease in the index of rice at 1.8 percent during the month from a                         5.7 percent annual increase in November 2024. Slower annual growth rate was also observed in the index of milk, other dairy products and eggs at 2.2 percent during the month from 3.7 percent and flour, bread and other bakery products, pasta products, and other cereals at 3.6 percent from 3.7 percent in November 2024.

On the contrary, higher annual growth rates during the month were observed in the indices of the following food groups: 

     a. Corn, 6.7 percent from 6.3 percent;
     b. Meat and other parts of slaughtered land animals, 8.0 percent from 7.3 percent;
     c. Fish and other seafood, 2.5 percent from 1.9 percent;
     d. Oils and fats, -0.3 percent from -1.9 percent; 
     e. Fruits and nuts, 3.9 percent from 3.0 percent;
     f. Vegetables, tubers, plantains, cooking bananas and pulses, 8.8 percent from 7.2 percent;
     g. Sugar, confectionery and desserts, -4.9 percent from -6.6 percent; and
     h. Ready-made food and other food products not elsewhere classified, 5.6 percent from 5.3 percent.

Main Contributors to the Food Inflation

Food inflation shared 50.1 percent or 1.2 percentage points to the overall inflation in December 2024. The top three food groups in terms of contribution to the food inflation during the month were the following:

     a. Meat and other parts of slaughtered land animals, with a share of 47.5 percent or 1.3 percentage points;  
     b. Vegetables, tubers, plantains, cooking bananas and pulses with a share of            25.3 percent or 0.7 percentage point; and
     c. Fish and other seafood with a share of 14.2 percent or 0.4 percentage point.
 

DEFINITIONS AND CONCEPTS

Consumer Price Index - a statistical measure of the change in average retail prices of a fixed basket of goods and services bought by a specific group of consumers in a given area in a given period of time.

Purchasing Power of the Currency or Peso (PPP) - a measure of the volume of goods and services which the currency can buy at any given period relative to that which it could purchase during the base year.  It is computed as the reciprocal of the CPI for the period under review multiplied by 100.

Market Basket - the total number of goods and services in constant amounts and qualities which are samples of the goods and services available in the market and included in the construction of the index.  CPI market basket was selected to represent the composite price behavior of all goods and services purchased by consumers. Composition of the 2012 market basket was determined based on the results of the 2018 update of the 2012 basket. Provinces and selected cities had own market baskets.  

Base Year - it identifies the base period with which the index relates. It is a period of time chosen as reference on which a price index is computed. The index for the base year is 100.

Retail Price - the actual price at which retailers sell a commodity on spot or earliest delivery, usually in small quantities for consumption and not for resale. It is confined to transactions on cash basis in the free market and excludes black-market prices and prices of commodities that are on sale as in summer sales, anniversary sales, Christmas sales, etc.

Percent Change - the percent point change expressed as percent of the index of the earliest date.

Inflation Rate - the annual rate of change or the year-on-year change of the CPI.  Inflation is interpreted in terms of declining purchasing power of money.

Note to Users:

    The monthly Consumer Price Index is computed based on the average retail prices of goods and services collected during the first week and mid-month of the reference month.