Tacloban City’s inflation rate continually declines at 2.4 percent in May 2023

Tacloban City’s inflation rate slows down further at 2.4 percent in May 2023 from 2.8 percent in April 2023. This is the lowest recorded inflation rate of the City since May 2022. Tacloban City’s inflation rate during the same period last year was higher at 5.0 percent. Likewise, Leyte recorded this month its lowest inflation rate since May 2022 at 3.7 percent. All other provinces and HUC in Eastern Visayas also registered a decrease in their respective inflation rates for this month.

The decrease in Tacloban City’s inflation rate during the reference period was due to the downtrend in annual rate of change of CPI of five (5) major commodity groups. Food and Non-Alcoholic Beverages recorded a decrease in its inflation rate at 8.1 percent from 8.7 percent in April 2023 which was driven by the slower rate of increase in prices of Cereals and Cereal Products, Fish and Other Seafood, Milk, Other Dairy Products and Eggs, Fruits and Nuts, Vegetables, Tubers, Pantains, Cooking Bananas and Pulses, Ready-made Food and Other Food Products, Coffee and Coffee Substitutes, and Other Non-Alcoholic Beverages. Likewise, Recreation, Sport and Culture recorded a decrease in its inflation rate at 1.2 percent in May 2023 from 1.6 percent in April 2023 due to the slower rate of increase in prices of Stationery and Drawing Materials. Furthermore, a 0.1 percentage point decrease was recorded in Information and Communication (0.2 percent to 0.1 percent) and Personal Care, and Miscellaneous Goods and Services (3.2 percent to 3.1 percent). The former was due to the slower rate of increase in prices of Equipment for the Reception, Recording and Reproduction of Sound and Vision while the latter was caused by the slower rate of increase in prices of Other Appliances, Articles and Products for Personal Care, Jewellery and Watches, and the faster rate of decrease in prices of Other Personal Effects. Moreover, Transport further registered a deflation of 5.7 percent in May 2023 from a deflation of 2.2 percent in April 2023 due to the faster rate of decrease in prices of Fuels and Lubricants for Personal Transport Equipment and the slower rate of increase in prices of Maintenance and Repair of Personal Transport Equipment and Passenger Transport by Air

On the other hand, five (5) major commodity groups recorded an increase in their respective inflation rates in May 2023. Alcoholic Beverages and Tobacco recorded an increase at 4.1 percent in May 2023 from 3.5 percent in April 2023 due to the faster rate of increase in prices of Tobacco. Clothing and Footwear recorded a slight increase at 0.3 percent in May 2023 from 0.2 percent in April 2023 due to the faster rate of increase in prices of Garments. Furnishings, Household Equipment and Routine Household Maintenance registered an increase at 1.4 percent in May 2023 from 1.2 percent in April 2023 caused by the faster rate of increase of Furniture, Furnishings and Loose Carpet, Major Household Appliances whether electric or not, and Non-durable Household Goods. Health recorded an increase at 2.1 percent in May 2023 from 1.8 percent in April 2023 caused by the faster rate of increase in prices of Medicines and Medical Products. Likewise, Restaurants and Accommodation Services recorded an increase at 5.9 percent in May 2023 from 4.3 percent in April 2023 due to the faster rate of increase in prices of Restaurants, Café and the like

Moreover, Housing, Water, Electricity, Gas and Other Fuels recorded a deflation of 2.9 percent in May 2023 from a deflation of 3.2 percent in April 2023. This was driven by the slower rate of decrease in prices of Security Equipment and Materials for the Maintenance and Repair of Dwelling, Electricity, and Gas.

Meanwhile, two (2) major commodity groups maintained their inflation rates from their previous months’ rate. These are Education Services with 1.0 percent and Financial Services with zero percent inflation rate.

The inflation rate is the general rise in prices over a period. It indicates how fast or how slow price changes over two-time periods. Contrary to common knowledge, low inflation does not necessarily connote that prices are falling instead; it means that prices continue to increase at a slower rate. It is a derived indicator of the Consumer Price Index (CPI).

The CPI is a measure of change in the average retail prices of goods and services commonly purchased by a particular group of people in a specific area. The overall CPI in Tacloban City for May 2023 was 116.1. This implies that the average retail price of goods and services in Tacloban City is 16.1 percent higher than the average retail prices in 2018 (base year). 

Purchasing Power of Peso (PPP) retains at 86 centavos in May 2023

The Purchasing Power of Peso (PPP) in Tacloban City retained at 86 centavos in May 2023. Meanwhile, the PPP in Leyte also retained at 84 centavos during the reference month. The 86 centavos purchasing power of peso in Tacloban City indicates that the same basket of goods and services worth 86 pesos in 2018 (base year) is worth 100 pesos during the reference period.

TECHNICAL NOTES 

      Rebasing of the CPI is necessary to ensure that this barometer of economic phenomena is truly reflective of current situation. Consumer taste, fashion and technology change over time causing the fixed market basket of goods and services to become outmoded. To capture such changes for a more meaningful price comparison, revision or updating of the fixed market basket, the sample outlets, the weights and the base year had to be done periodically.

BASE PERIOD – refers to the reference period of the index number. It is a period at which the index is set to 100. Current base period is 2018. 

MARKET BASKET - refers to a sample of goods and services used to represent all goods and services bought by a particular group of consumers in a particular area. 

WEIGHTS - The weights for the 2018-based CPI were derived from the expenditure data of the 2018 Family Income and Expenditure Survey (FIES). The weight for each item of expenditure is a proportion of that expenditure item to the total national expenditure. The total (all items) national expenditure weights is equal to 100. 

MONITORING OF PRICES - is to establish baseline information for prices of the items in the base year and monitoring of the prices of the items on a regular basis. Except for Food, Beverage and Tobacco which is monitored on a weekly basis in NCR, price collection is done twice a month. First collection phase is done during the first five days of the month while the second phase is on the 15th to 17th day of the month. 

COMPUTING THE CPI - The formula used in computing the CPI is the weighted arithmetic mean of price relatives, a variant of the Laspeyres formula with fixed base year period weights. 

RETAIL PRICE - refers to 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. 

CONSUMER PRICE INDEX – is a measure of change in the average retail prices of goods and services commonly purchased by a particular group of people in a particular area. 

INFLATION RATE – refers to the annual rate of change or year-on-year change in CPI.

PURCHASING POWER PESO – it is a measure of how much the peso in the base period is worth in another period. It gives as indication of the real value in a given period relative to the peso value in the base period.

SGD. BERNADETTE R. MONTANA
Supervising Statistical Specialist 
Officer-in-charge