1. Headline Inflation

La Union’s headline inflation for the bottom 30% income households increased to 7.0 percent in June 2024 from 6.7 percent in May 2024.  This brings the provincial average inflation for this income group from January to June 2024 to 6.2 percent.  In June 2023, inflation rate for the bottom 30% income households was posted at 5.1 percent.  (Table A and Figure1)

1.1 Main Drivers to the Upward Trend of the Overall Inflation

The main driver to the upward trend of the overall inflation for the bottom 30% income households in the province in June 2024 was housing, water, electricity, gas and other fuels with 4.7 percent annual inflation during the month from 3.0 percent in May 2024.

This was followed by food and non-alcoholic beverages with an annual increment of 11.7 percent in June 2024 from 11.5 percent in May 2024.   Information and communication ranked third main contributor to the acceleration of inflation for this income group as it recorded a year-on-year increase of 0.2 percent during the month from zero percent inflation in the previous month.

On the contrary, slower annual growth rates were noted in the indices of the following commodity groups during the month:

1. Furnishings, household equipment and routine household maintenance, 0.8 percent from 1.0 percent; and

2. Transport, 3.9 percent from 4.0 percent.

Meanwhile, the indices of the following commodity groups retained their respective previous month’s annual increment:

1. Alcoholic beverages and tobacco, at 3.4 percent;

2. Clothing and footwear, at 1.5 percent;

3. Health, at 1.5 percent;

4. Recreation, sport and culture, at 0.3 percent; and

5. Personal care and miscellaneous goods and services, at 0.7 percent.

Education services, restaurants and accommodation services, and financial services recorded zero percent inflation during the month.

1.2 Main Contributors to the Overall Inflation

The top three commodity groups contributing to the June 2024 overall inflation for the bottom 30% income households of the province were the following:

1. Food and non-alcoholic beverages with 83.4 percent share or 5.8 percentage points;

2. Housing, water, electricity, gas and other fuels with 10.4 percent share or 0.7 percentage point; and

3. Transport with 3.6 percent share or 0.3 percentage point.

2. Food Inflation

Food inflation for the bottom 30% income households at the provincial level also exhibited an uptrend with 12.3 percent in June 2024 from 12.2 percent in May 2024. In June 2023, food inflation was observed at 5.6 percent.

2.1 Main Drivers to the Upward Trend of Food Inflation

The uptrend in the food inflation of the province in June 2024 was primarily contributed by the faster annual increase in the fish and other seafood index at 4.7 percent during the month from 2.5 percent in May 2024. This was followed by fruits and nuts with an annual growth rate of 25.2 percent in June 2024 from 14.9 percent in May 2024.  The third contributor to the uptrend of food inflation in June 2024 was recorded in the meat and other parts of slaughtered land animals with a faster year-on-year mark-up of 4.1 percent during the month from 3.4 percent in May 2024.

In addition, ready-made food and other food products not elsewhere classified also recorded a faster annual increase of 7.3 percent in June 2024 from 6.0 percent in the previous month.

In contrast, slower annual increases were observed in the indices of the following food groups during the month:

1. Rice, 34.8 percent from 35.1 percent;

2. Flour, bread and other bakery products, pasta products, and other cereals, 2.4 percent from 2.7 percent; and

3. Vegetables, tubers, plantains, cooking bananas and pulses, 1.6 percent from 6.8 percent

A faster annual decline of 3.5 percent in June 2024 from an annual drop of 3.1 percent in May 2024 was observed in the milk, other dairy products and eggs index.  Likewise, a faster annual decrease of 4.5 percent during the month from an annual decline of 4.1 percent in the previous month was recorded in the sugar, confectionery, and desserts index.

Meanwhile, the annual increase of 17.9 percent in the corn index and the annual decline of 6.6 percent in the oils and fats index remained during the month.

2.2 Main Contributors to the Food Inflation

Food inflation contributed 82.8 percent or 5.8 percentage points to the overall inflation for the bottom 30% income households in the province in June 2024.

Among the food groups, the top three main contributors to the food inflation during the month were the following:

1. Cereals and cereal products, which includes rice, corn, flour, bread and other bakery products, pasta products, and other cereals with 85.9 percent share or 10.6 percentage points;

2. Fruits and nuts, with 5.1 percent share or 0.6 percentage point; and

3. Meat and other parts of slaughtered land animals with 4.9 percent share or 0.6 percentage point.

SGD. DANITES E. TEÑIDO, PhD
Chief Statistical Specialist
La Union Provincial Statistical Office

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