Photo credit: PCO

The Philippines witnessed a slight uptick in headline inflation, reaching 3.8 percent in April 2024, as reported by the Philippine Statistics Authority.

This marks a modest increase from the 3.7 percent recorded in March 2024 and contributes to a national average inflation of 3.4 percent for the first four months of the year, reflecting a stabilization compared to the 6.6 percent seen in April 2023.

The upward trajectory of overall inflation can be attributed to several key factors. Notably, the food and non-alcoholic beverages sector saw a notable increase, rising to 6.0 percent in April from 5.6 percent in March. Additionally, the transport index accelerated to 2.6 percent in April from 2.1 percent in the previous month, further propelling inflation.

Conversely, certain sectors experienced a decrease in inflation rates, including alcoholic beverages and tobacco, housing, and recreation, among others. These contrasting trends showcase the nuanced landscape of inflationary pressures across various segments of the economy.

Analyzing the main contributors to inflation in April 2024 reveals that food and non-alcoholic beverages held the largest share, accounting for 59.7 percent and contributing 2.3 percentage points to overall inflation. This was followed by restaurants and accommodation services, contributing 13.7 percent, and transport, contributing 6.2 percent.

Within the food sector, inflation surged to 6.3 percent nationally in April 2024, up from 5.7 percent in March. Despite this increase, it falls short of the 8.0 percent recorded in April 2023.

The acceleration in food inflation was predominantly fueled by increases in the prices of vegetables, tubers, and other essential food items. Notably, the index for vegetables and pulses rose by 4.3 percent, contributing to the overall uptrend. Additionally, ready-made food and miscellaneous food products witnessed faster annual growth rates, further driving food inflation.

However, certain food groups experienced slower declines or lower growth rates, including rice, meat, dairy products, and fruits, indicating a varied inflationary landscape within the food sector.

Food inflation remained a significant contributor to overall inflation, accounting for 57.9 percent and contributing 2.2 percentage points to the national inflation rate in April 2024.

Core inflation, which excludes selected food and energy items, decelerated to 3.2 percent in April 2024, down from 3.4 percent in March. This represents a notable decrease compared to the 7.9 percent recorded in April 2023.

Regional Disparities in Inflation

In the National Capital Region (NCR), inflation eased to 2.8 percent in April 2024, reflecting a decrease from 3.3 percent in March. However, disparities exist within various commodity groups, with housing and food sectors experiencing notable decreases in inflation rates.

In areas outside NCR (AONCR), overall inflation followed the national trend, rising to 4.1 percent in April 2024. While certain commodity groups saw declines in inflation rates, others experienced increases, contributing to the overall uptrend.

Despite these fluctuations, regional disparities persist, with the Bangsamoro Autonomous Region in Muslim Mindanao maintaining the highest inflation rate at 6.3 percent, while Region I (Ilocos Region) recorded the lowest at 2.4 percent.