1.    Overall Inflation

Central Luzon’s inflation rate for the bottom 30 percent income households increased to 3.2 percent in December 2024 from 3.0 percent in November 2024. This marks a 0.2 percentage point increase from November 2024 and 2.7 percentage points decrease from the inflation rate recorded in December 2023. (Table 1 and Figure 1)

1.1     Main Drivers to the Upward Trend of the December 2024 Overall Inflation in Central Luzon

The uptrend in the overall inflation in December 2024 was primarily brought about by the higher year-on-year growth rate in the index of transport at 1.0 percent in December 2024 from -1.2 percent in November 2024 and food and non-alcoholic beverages at 3.2 percent in December 2024 from 3.0 percent in November 2024. (Table 2)

On the other hand, slower annual increments were registered in the following indices;
•    furnishings, household equipment and routine household maintenance, 1.6 percent from 1.8 percent;
•    health, 1.5 percent from 1.9 percent;
•    recreation, sports and culture, 4.3 percent from 5.1 percent; and
•    restaurants and accommodation services, 4.1 percent from 4.4 percent.

Additionally, the following indices retained their previous month’s annual rate:
•    alcoholic beverages and tobacco, 3.0 percent;
•    clothing and footwear, 2.4 percent;
•    housing, water, electricity, gas and other fuels, 4.5 percent;
•    information and communication, 0.3 percent; 
•    education services, 3.0 percent;
•    financial services, -0.1 percent; and
•    personal care, and miscellaneous goods and services, 3.7 percent.

 

1.2     Main Contributor to the December 2024 Overall Inflation in Central Luzon

The following commodity groups were the top three contributors to the December 2024 overall inflation for the bottom 30% income households:
•    food and non-alcoholic beverages with 48.6 percent share or 1.6 percentage points;
•    housing, water, electricity, gas and other fuels with 21.0 percent share or 0.7 percentage point; and
•    restaurants and accommodation services with 13.9 percent share or 0.4 percentage point.

2.    Annual Average Inflation

The annual average inflation rate in 2024 for bottom 30% income group was observed at 4.7 percent, lower than the 2023 annual average inflation rate of 7.7 percent.

2.1     Main Drivers to the Downward Trend of the 2024 Annual Average Inflation in Central Luzon

The downtrend in the 2024 average inflation in Central Luzon for the bottom 30% income households was mainly brought about by the lower annual average increase in the indices of food and non-alcoholic beverages at 5.3 percent in 2024 from 9.5 percent annual average inflation in 2023. Also contributed to the downtrend were the slower increments in the indices of alcoholic beverages and tobacco at 4.6 percent in 2024 from 13.1 percent annual average inflation in 2023 and restaurants and accommodation services at 5.2 percent in 2024 from 7.7 percent in 2023.

The rest of the commodity groups recorded downtrend in their annual average inflation rate except for the indices education services and housing, water, electricity, gas and other fuels which recorded an uptrend at 5.9 percent and 4.5 percent, respectively.
 

2.2     Main Contributors to the 2024 Annual Average Inflation in Central Luzon

The following commodity groups were the top three contributors to the 2024 annual average inflation for the bottom 30% income households:
•    food and non-alcoholic beverages with 56.5 percent share or 2.7 percentage points;
•    housing, water, electricity, gas and other fuels with 14.8 percent share or 0.7 percentage point; and
•    restaurants and accommodation services with 12.4 percent share or 0.6 percentage point.

3.    Food Inflation

The food inflation for the bottom 30% income households in Central moved at a faster pace at 3.2 percent in December 2024 from 3.1 percent in November 2024.

3.1     Main Drivers to the Upward Trend of the Food Inflation in Central Luzon

The acceleration of food inflation can be primarily attributed to the faster increments in the index of vegetables, tubers, plantains, cooking bananas and pulses at 27.2 percent in December 2024 from 10.9 percent in November 2024, followed by the index of meat and other parts of slaughtered land animals at 5.3 percent in December 2024 from 4.0 percent in November 2024, and fish and other seafood at 1.6 percent in December 2024 from 0.7 percent in November 2024. (Table 3)

Moreover, faster increments were also recorded in the following indices:
•    oils and fats, 1.5 percent from 0.6 percent; and
•    fruits and nuts, 5.7 percent from 4.9 percent;

Furthermore, the index of sugar, confectionery and desserts recorded slower annual decline of 2.2 percent in December 2024 from annual decrease of 2.6 percent in November 2024. Meanwhile, ready-made food and other food products not elsewhere classified retained its previous month’s inflation rate at 4.6 percent.

In contrast, slower annual increments was recorded in the index of milk, other dairy products and eggs at 2.9 percent in December 2024 from 3.4 percent in November 2024. Additionally, the index of cereals and cereal products recorded an annual decline of 2.4 percent in December 2024 from an annual increase of 2.1 percent in November 2024.

3.2     Main Contributors to the Food Inflation in Central Luzon

Food inflation contributed 47.0 percent or 1.5 percentage points to the December 2024 overall inflation for the bottom 30% income households. Among the food groups, the main contributors to the upward trend in the food inflation for the month of December 2024 for the bottom 30% income households were the following:
•    vegetables, tubers, plantains, cooking bananas and pulses with 73.0 percent share or 2.3 percentage points;
•    meat and other part of slaughtered land animals with 30.5 percent share or 1.0 percentage point; and
•    fish and other seafood with 7.8 percent share or 0.3 percentage point.
 

3.3     Annual Average Food Inflation in Central Luzon

In 2024, the annual average food inflation rate for the bottom 30% income households in Central Luzon was observed at 5.6 percent, lower than the recorded annual average food inflation rate of 9.6 percent in 2023.

4.    Inflation by Province

Relative to the November 2024 inflation rates for bottom 30 percent income households, three provinces (Pampanga, Tarlac, and Bulacan) in the region exhibited higher inflation rates in December 2024. In contrast, Bataan, Nueva Ecija, Zambales, Aurora, and City of Olongapo exhibited lower inflation rates. Meanwhile, City of Angeles recorded the same inflation rate as the previous month at 3.4 percent. Nueva Ecija registered the largest decrease in inflation with a difference of 0.7 percentage point.

Among the provinces and HUCs in the region, the province of Pampanga recorded the highest inflation rate for bottom 30 percent income households at 4.8 percent, followed by City of Olongapo at 4.3 percent. Meanwhile, Zambales registered the lowest inflation rate for the bottom 30 percent income households at 1.5 percent, followed by Bataan and Nueva Ecija at 2.3 percent and 2.4 percent, respectively. (Figure 2)

ARLENE M. DIVINO
Regional Director 
PSA RSSO 03