INFLATION RATES FOR ALL ITEMS

TABLE 1. YEAR-ON-YEAR INFLATION RATES, ALL ITEMS

IN PERCENT

(2018=100)

A. HEADLINE INFLATION

The headline inflation in BARMM decelerated at 1.3 percent in December 2024. In November, the inflation rate was recorded at 1.7 percent. This brings the regional annual inflation from January to December 2024 to 3.9 percent. In comparison, the inflation rate in December 2023 was higher at 6.2 percent.

Maguindanao and Sulu showed lower inflation rates compared to their previous month’s rates. While Basilan, Tawi-Tawi and Cotabato City, an Independent Component City (ICC), posted a lower inflation rate than in the previous month. Lanao del Sur, on the other hand, retained its inflation rate from the previous month. (See Table 1 and Figure 1)

Main Drivers to the Downward Trend of the Overall Inflation

The downtrend in overall inflation in BARMM in December 2024 was primarily driven by the decrease in the index of food and non-alcoholic beverages, which decreased at -0.2 percent in December 2024 from 0.8 percent in the previous month. Another contributor to the decreasing inflation was the Clothing and Footwear commodity group, which also decreased at 1.8 percent. (Table 2)

The following commodity groups also posted lower inflation rates in December 2024:

•       Alcoholic beverages and tobacco, 1.8 percent from 1.9 percent;

•      Furnishing, household equipment, routine and maintenance of the house, 2.9 percent from 3.0 percent;

•       Information and communication, 0.2 percent from 0.3 percent; and 

•        Personal care, miscellaneous goods and services, 4.1 percent from 4.2 percent.

Meanwhile, the commodity group of transport recorded an increase of its inflation rate compared to the previous month, with 4.4 percent from -1.4 percent. 

On the other hand, the following commodities remain the same as their November 2024 rates: 

1.       Housing, Water, Electricity, Gas, and Other Fuels, 3.8 percent;

2.       Health, 2.3 percent;

3.       Recreation, Sports and Culture, 2.1 percent;

4.       Education Services, 5.0 percent;

5.       Restaurant and Accommodation Services, 5.4 percent;

6.       Financial Services, 0.0 percent

B. INFLATION RATES FOR FOOD ITEMS

For food commodities, inflation decreased to -0.5 percent in December 2024 from 0.6 percent in the previous month. In December 2023, inflation of food items was higher at 7.5 percent. (See Table 3)

The decrease in the region's food inflation was primarily driven by the lower index for fish and other seafood, which decreased to 0.4 percent from 4.1 percent in the previous month. This was followed by the cereals and cereal products with -0.2 percent inflation rate. Additionally, the index for vegetables, tubers, plantains, cooking bananas and pulses further decreased to -4.3 percent in December, from -3.5 percent in November 2024.

Moreover, decrease in rates were also observed in the following food commodity groups:

1.       Sugar, confectionery and desserts, -2.9 percent from -2.3 percent;

2.       Meat and other parts of slaughtered land animals, 0.8 percent from 1.3 percent;

3.       Oils and fats, -0.6 percent from -0.1 percent; and,

4.       Ready-made food and other food products; 1.7 percent from 1.8 percent.

Conversely, the following food groups recorded higher inflation rates in December 2024: 

1.       Milk, other dairy products, and eggs, 5.3 percent from 4.5 percent;

2.       Fruits and nuts, -1.9 percent from -2.4 percent;

3.       Corn, -7.1 percent from -7.3 percent; and

4.       Flour, bread and other bakery products, pasta products, and other cereals; 2.4 percent from 2.2 percent. 

C. PURCHASING POWER OF PESO

In BARMM, the Purchasing Power of the Peso (PPP) is at PhP 0.79 as of December 2024. (See Figure 2) 

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: 

1. 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.

1. 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.

1. Weighting System

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

1. 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 (2018) weight.

1. 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 the declining purchasing power of the 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 provinces including Cotabato City and excluding Special Geographic Area (SGA).

Approved for release:

SGD.

ENGR. AKAN G. TULA

OIC-Regional Director

EDFE/BMB/AAA