INFLATION RATES FOR ALL ITEMS

            The headline inflation rate in Lanao del Sur province decreased further to negative 0.2 percent in May 2025 from 1.0 percent in April 2025 (see Figure 1). This represents 5.9 percentage points lower from its level 5.7% in the same month last year. This is the lowest inflation since January 2025. Moreover, Lanao del Sur posted a 1.6 percent year-to-date inflation rate in All items. (see Table 1)

                 The decrease in price in the following Commodity Groups in province’s inflation was mainly brought about by the slower annual decreases in the index for Food and Non-Alcoholic Beverages at negative 1.5 percent, Health at 0.7 percent and Personal care, and miscellaneous goods and services at 0.8 percent.(see Table 2)

                  On the other hand, the commodity group shows higher inflation rate in May 2025 are the following:
    
    a. Alcoholic beverages and tobacco at 0.8 percent
    b. Clothing and footwear at 1.9 percent
    c. Furnishing, Household Equipment and Routine Maintenance of the House at 1.9 percent
    d. Recreation, sport and culture at 1.8 percent
    e. Restaurants and Accommodation Services at 1.7 percent
 

                  Meanwhile, the commodity groups retained their previous month’s inflation rate are the following:

    a. Housing, Water, Electricity, Gas and Other
    b. Transport
    c. Information and Communication
    d. Education services
    e. Financial

INFLATION RATES FOR FOOD ITEMS
                For food index, it decreased further by negative 1.7 percent in May 2025 from 0.7 percent in the previous month. In May 2024, food index was higher at 8.5 percent.

                The decrease in the province’s food inflation rate was mainly brought about by the slower annual decreases in the index for Cereals and cereal products at negative 5.4 percent, Vegetables, tubers, plantains, cooking bananas and pulses at negative 3.8 percent and Ready-Made Food and Other Food Products N.E.C at 0 percent. Also contributing to the downtrend in the overall food inflation during the period were the lower annual depletion in the indices of the following food commodity groups as compared with their previous month’s inflation rates:

    a. Fruits and nuts at 1.0 percent
    b. Sugar, Confectionery and Desserts at negative 2.8 percent
    c. Oils and Fats at 2.7 percent

    Meanwhile, the annual uptick higher indices on the commodity group are the following:

    a. Meat and other parts of slaughtered land animal at 7.1 percent
    b. Fish and other seafood at 1.9 percent
    c. Milk, Other Dairy Products, and Eggs at 11.6 percent

PURCHASING POWER OF PESO
                  Purchasing Power of Peso (PPP) is inversely related to inflation rate. Thus, as the inflation rate increases, PPP declines. As shown in Figure 2, Lanao del Sur, PPP is higher compared to previous month at 0.81 as of May 2025. 

TECHNICAL NOTES:

Consumer Price Index (CPI)

The CPI is an indicator of the changes in the average retail prices of a fixed basket of goods and services commonly purchased by households relative to a base year.

Uses of CPI

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

Computation of CPI

The computation of the CPI involves consideration of the following important points: 

a. Base Period

The reference date or base period is the benchmark or reference date or period at which the index is taken as equal to 100.

b. Market Basket

A sample of the thousands of varieties of goods purchased for consumption and services availed by the households in the country selected to represent the composite price behavior of all goods and services purchased by consumers.

c. Weighting System

The weighting pattern uses the expenditures on various consumer items purchased by households as a proportion to total expenditure.

d. Formula

The formula used in computing the CPI is the weighted arithmetic mean of price relatives, the Laspeyre’s formula with a fixed base year period (2006) weight.

e. Geographic Coverage

CPI values are computed at the national, regional, and provincial levels, and for selected cities.

Inflation Rate

the rate of change of the CPI expressed in percent. Inflation is interpreted in terms of declining purchasing power of peso.

Headline Inflation

refers to the rate of change in the CPI, a measure of the average standard “basket” of goods and services consumed by a typical family.

Purchasing Power of 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.

Note: The dataset used in the special release is exclusive for BARMM region and Lanao del Sur province.

MOHAMMADALI R. ALONTO, MPA
OIC Chief Statistical Specialist