Headline Inflation

The headline inflation rate in the Province of Dinagat Islands for September 2024 continues to recede to 2.3 percent from 3.5 percent in August 2024, reflecting a 1.2 percentage point decrease. This also marks a drop of 3.2 percentage points from the 5.5 percent rate recorded in September 2023. The year-to-date inflation rate averages 4.6 percent, surpassing the national and regional averages of 3.4 percent and 2.8 percent, respectively (refer to Table A and Figure 1).

Main Drivers to the Downward Trend in Overall Inflation

The decline in September 2024's inflation rate is mainly attributed to the Food and Non-alcoholic Beverages group, which recorded a 6.4 percent inflation rate, contributing approximately 60.3 percent to the overall provincial inflation decrease. The Transport group also presented a drop in the average price indices, leading to a -2.5 percent inflation rate, lower by     -0.5 percent in the previous month, contributing around 17.8 percent to the overall trend.

Additionally, the Personal Care, miscellaneous goods and services group recorded a slower increase in the average price indices, particularly driven by the decrease in the prices of other appliances, articles and products for personal care, with an inflation rate of 1.5 percent compared to 2.8 percent in August 2024, contributing approximately 8.4 percent to the overall provincial inflation rate (refer to Tables B and C).

Other commodity groups experiencing a downtrend in average price indices included:

•    Clothing and footwear with decreased IR of 2.8 percent from 2.9 percent in the previous month;
•    Housing, water, electricity, gas and other fuels with lower IR of -0.4 from -0.1 in last month;
•    Furnishings, Household Equipment, and Routine Household Maintenance: Inflation Rate of -2.5 percent, down from -1.8 percent;
•    Health with an inflation rate of 0.7 percent from 1.7 percent in August 2024;
•    Recreation, sports and culture with an inflation rate of -3.2 percent from   -0.6 percent in last month.
Contrarywise, the following commodity groups saw rapid increases in price indices this month:
•    Alcoholic Beverages and Tobacco: Registered an inflation rate of 6.2 percent, up from 5.1 percent in August 2024.
•    Education Services: Inflation rate of 0.0 percent, up from -1.7 percent in August 2024.

Top Contributors to the Overall Provincial Inflation Rate

The following commodity groups were the top two contributors to the September 2024 overall inflation for all income households.

•    Food and Non-alcoholic beverages, 82.2 percent share or 1.89 percentage points and
•    Housing, water, electricity, gas, and other fuels, 7.5 percent share or 0.17 percentage points; 

Food Index

The food index for September 2024 also saw a slower increase in average prices, decreasing to 4.0 percent from 6.5 percent in August 2024.
The main drivers for the declining food index compared to the previous month include (see Table D):
1.    Cereals and Cereal Products (particularly rice): Recorded an inflation rate of 9.1 percent, up from 14.0 percent in the previous month, contributing about 59.6 percent to the food inflation trend.
2.    Fish and Other Seafood: Registered an inflation rate of -3.9 percent, up from -1.0 percent in the previous month, contributing about 19.8 percent to the overall uptrend; and
3.    Vegetables, Tubers, Plantains, Cooking Bananas, and Pulses: Noted an inflation rate of 1.5 percent, down from 8.5 percent in the previous month, contributing approximately 17.8 percent to the food inflation trend.

Purchasing Power of Peso

The Purchasing Power of the Peso (PPP) for the Province of Dinagat Islands was pegged at Php 0.73 since in April 2024.

(Sgd.) VILLUZ C. OROZCO
(Supervising Statistical Specialist)
Officer-in-Charge

Technical Notes

The Philippine Statistics Authority generates the monthly Consumer Price   Index (CPI) based on the nationwide survey of prices for a given basket of goods and services. Two important indicators, the inflation rate and purchasing power of the peso (PPP) are derived from the CPI which is important in monitoring price stability and the value of the country’s currency.

The Consumer Price Index (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. It shows how much on the average, prices of goods and services have increased or decreased from a particular reference period known as base year.

The CPI is mostly used in the calculation of the rate and purchasing power of the peso. It is a major statistical series used for economic analysis and as monitoring indicator of government economic policy.

The CPI is also used to adjust other economic series for price changes.  Another major importance of the CPI is its use as basis to adjust wages in labor management contracts as well as pensions and retirement benefits. 

Inflation rate refers to the rate of change in the average prices of goods and services typically purchased by consumers. It is interpreted in terms of declining purchasing power of money

The Purchasing Power of the Peso (PPP) indicates the value of the peso in the period under review as compared to the   value of the peso in the base period. It is computed as the reciprocal of the CPI for the period under review     multiplied by 100.