1. Headline Inflation
La Union’s headline inflation slowed down further to 2.8 percent in February 2024. Inflation rate in the province was recorded at 3.1 percent in January 2024 and at 6.2 percent in February 2023. (Table A and Figure1)
1.1 Main Drivers to the Downward Trend of the Headline Inflation
The downtrend in the inflation of the province in February 2024 was primarily influenced by the annual decline in the index of housing, water, electricity, gas and other fuels at -0.3 percent from 0.5 percent annual increase in January 2024.
This was followed by food and non-alcoholic beverages with a slower annual increment of 6.9 percent in February 2024 from 7.1 percent in January 2024. Personal care, and miscellaneous goods and services ranked third main contributor to the downtrend of the headline inflation of the province as it recorded a slower annual increase of 0.4 percent in February 2024 from 1.5 percent in the previous month.
Slower annual growths were also noted in the indices of the following commodity groups during the month:
Clothing and footwear, 1.1 percent from 2.5 percent;
Information and communication, 0.3 percent from 0.7 percent;
Furnishings, household equipment and routine household maintenance, 1.5 percent from 1.8 percent; and
Alcoholic beverages and tobacco, 2.0 percent from 2.3 percent.
In addition, faster year-on-year decline was observed in the index of recreation, sport and culture at -1.3 percent during the month from -0.6 percent in January 2024.
In contrast, slower annual decrease was registered in the transport index at -0.3 percent in February 2024 from -1.6 percent in the previous month.
Meanwhile, the indices of education services and financial services retained their previous month’s annual increment of 0.8 percent and annual decrease of -0.1 percent, respectively. The annual inflation of restaurants and accommodation services also remained at zero percent during the month.
1.2 Main Contributors to the Headline Inflation
The top three commodity groups contributing to the February 2024 overall inflation of the province were the following:
Food and non-alcoholic beverages with 95.3 percent share or 2.67 percentage points;
Health with 2.1 percent share or 0.06 percentage point; and
Furnishings, household equipment and routine household maintenance with 1.9 percent share or 0.05 percentage point.
2. Food Inflation
Food inflation at the provincial level eased to 7.3 percent in February 2024 from 7.6 percent in January 2024. In February 2023, food inflation was higher at 8.8 percent.
2.1 Main Drivers to the Downward Trend of Food Inflation
The deceleration of food inflation of the province in February 2024 was primarily contributed by slower annual increment in the index of Rice at 35.6 percent from 38.5 percent in January 2024. This was followed by fish and other seafoods with a slower inflation rate of 2.2 percent during the month from 4.2 percent in January 2024. The third contributor to the downtrend of food inflation in February 2024 was seen in the index of milk, other dairy products, and eggs with a year-on-year decline of -0.1 percent during the month from 2.2 percent in January 2024.
Moreover, lower annual increments were also observed in the indices of the following food groups during the month:
Flour, bread and other bakery products, pasta products, and other cereals, 1.9 percent from 2.2 percent; and
Ready-made food and other food products not elsewhere classified, 1.2 percent from 1.3 percent.
Faster annual decline was also noted in the index of sugar, confectionery and desserts at -5.1 percent in February 2024 from -3.0 percent in January 2024.
On the contrary, corn registered a faster annual increment of 17.9 percent during the month from 10.7 percent in January 2024. Fruits and nuts also recorded a faster annual growth of 7.2 percent in February 2024 from 2.2 percent in the previous month.
Meanwhile, slower annual decreases were observed in the indices of the following food groups during the month:
Meat and other parts of slaughtered land animals, -0.5 percent from -1.4 percent;
Oils and Fats, -2.2 percent from -3.1 percent; and
Vegetables, tubers, cooking bananas and pulses, -5.8 percent from -8.6 percent.
2.2 Main Contributors to the Food Inflation
Food contributed 95.1 percent or 2.7 percentage points to the overall inflation in February 2024. The food groups with the highest contribution to food inflation during the month were the following:
Cereal and cereal products, which includes rice, corn, flour, bread and other bakery products, pasta products, and other cereals with 100.8 percent share or 7.4 percentage points;
Fish and other seafood, with 3.4 percent share or 0.3 percentage point; and
Fruits and nuts, with 3.4 percent share or 0.2 percentage point.
SGD. DANITES E. TEÑIDO, PhD
Chief Statistical Specialist
/MMAAA
