Headline Inflation

The region’s headline inflation or overall inflation accelerated to 2.2 percent in May 2025 from 1.6 percent in the previous month. This brings the regional average inflation rate from January to May 2025 to 2.3 percent. In May 2024, the inflation rate was higher at 3.7 percent.

Main Drivers to the Upward Trend of the Headline Inflation

The uptrend in the overall inflation in May 2025 was primarily brought about by the faster annual increment in the index of food and non-alcoholic beverages at 1.9 percent in May 2025 from 0.9 percent in the previous month, housing, water, electricity, gas and other fuels at 3.7 percent from 2.5 percent in the previous month, and restaurants and accommodation services at 4.7 percent during the month from 3.9 percent in April 2025.

Also contributing to the uptrend was the alcoholic beverages and tobacco index at 3.2 percent during the month from 3.0 percent in the previous month.

On the contrary, lower inflation rates were observed in the following commodity groups during the month:

a. Clothing and Footwear, 1.4 percent from 2.9 percent;
b. Furnishings, household equipment and routine household maintenance, 3.5 percent from 4.1 percent;
c. Health, 3.4 percent from 3.5 percent;
d. Information and communication, 1.4 percent from 1.7 percent;
e. Recreation, sport and culture, 4.1 percent from 4.3 percent; and
f. Personal care, and miscellaneous goods and services, 2.9 percent from 3.1 percent.

Moreover, faster annual decline was observed in the index of transport at 2.0 percent from 1.7 percent annual drop in the previous month.

The indices of the rest of the commodity groups retained their respective previous month’s annual growth rates, with financial services registering a zero percent annual rate in May 2025.

Main Contributors to the Headline Inflation

The top three commodity groups contributing to the May 2025 overall inflation were the following:

a. Food and non-alcoholic beverages with 37.6 percent share or 0.8 percentage point;
b. Housing, water, electricity, gas and other fuels with 28.5 percent share or 0.6 percentage point; and
c. Restaurants and accommodation services with 14.2 percent share or 0.3 percentage point.

Food Inflation

Food inflation at the regional level accelerated to 1.5 percent in May 2025 from 0.6 percent in the previous month. In May 2024, food inflation was higher at 6.4 percent.

Main Drivers to the Upward Trend of Food Inflation

The acceleration of food inflation in May 2025 was primarily brought about by the faster year-on-year increase of fish and other seafood at 7.4 percent during the month from a 3.4 percent in April 2025. This was followed by the faster inflation rates of meat and other parts of slaughtered land animals at 12.5 percent during the month from 10.6 percent in April 2025, and vegetables, tubers, plantains, cooking bananas and pulses at 14.4 percent in May 2025 from 10.9 percent in the previous month.

Moreover, lower inflation rates during the month were noted in the following food groups:
a. Milk, other dairy products and eggs, 4.6 percent from 2.9 percent;
b. Oils and fats, 5.1 percent from 3.0 percent; and
c. Fruits and nuts, 14.5 percent from 10.7 percent.

On the other hand, lower annual growth rates during the month were observed in the indices of the following food groups:
a. Corn, 2.6 percent from 5.7 percent;
b. Flour, bread and other bakery products, pasta products, and other cereals, 3.3 percent from 3.5 percent; and
c. Ready-made food and other food products not elsewhere classified, 3.9 percent from 4.0 percent.

In addition, faster annual decrement was noted during the month in the index of rice at 16.1 percent from 13.7 percent annual decrease in the previous month, and sugar, confectionery and desserts at 1.2 percent from 1.0 percent annual drop in April 2025.

Main Contributors to the Food Inflation

Food inflation shared 30.0 percent or 0.7 percentage point to the overall inflation in May 2025. The top three food groups in terms of contribution to food inflation during the month were the following:
a. Meat and other parts of slaughtered land animals with a share of 136.5 percent or 2.1 percentage points;
b. Fish and other seafood with a share of 79.3 percent or 1.2 percentage points; and
c. Vegetables, tubers, plantains, cooking bananas and pulses with a share of 66.1 percent or 1.0 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.