Annual inflation cools to 5.9%
New data released by the Statistical Institute of Jamaica, Statin, on Wednesday shows that inflation rose in September, as students returned to school from summer break, but prices rose at a slower pace than previous months.
Monthly inflation was estimated at 0.5 per cent; while annual inflation was 5.9 per cent, down from 6.8 per cent in August and 6.6 per cent in July.
It puts consumer prices back within the central bank’s target range.
The data showed that chief among the contributors to the upward movement in September prices was an 11.8 per cent increase in education spending, due to higher tuition fees for primary-level private schools. Additionally, higher petrol prices led to a 0.7 per cent increase in the transport index.
The food and non-alcoholic beverages index, which is the biggest driver of inflation, rose by 0.1 per cent in September.
Still, consumer goods were a little less pricey on an annualised basis, Statin reported, due to what the state agency says is lower prices for some agricultural products as a result of favourable weather conditions, as well as a 1.9 per cent fall in the ‘housing, water, electricity, gas and other fuels’ category. The latter category fell mainly due to lower electricity charges, Statin reported.
The main contributors to the 5.9 per cent inflation rate were the divisions food and non-alcoholic beverages, up by 9.8 per cent; and restaurants and accommodation services, up by 12 per cent.
The state agency, led by Director General Carol Coy, said food inflation was mainly driven by higher prices for yam, sweet potato, tomato, cabbage, and carrot, amid a 23 per cent spike in prices for the wider vegetables and produce class of goods.
Cereals and cereal products also rose 4.6 per cent due to price increases for bread, flour and rice; and meats climbed by 4.2 per cent, driven by higher chicken and other meat product prices.
At 5.9 per cent, annual inflation is at a 5-month low and also sits at the top end of the Bank of Jamaica’s target range of 4.0 to 6.0 per cent.
The central bank continues to hold its policy interest rate steady at 7.0 per cent, given the track of inflation. Its next pronouncement is set for November 21.
Amid the record employment now being experienced in the economy, BOJ Governor Richard Byles has urged companies to seek value through productivity gains, rather than wage spikes, in order to keep pressure off the inflation rate.
On Wednesday, Statin reported that Jamaica’s unemployment rate continues to improve, with more women taking up jobs. For the July survey, the rate dipped by 2.1 percentage points to 4.5 per cent.