Inflation Remains Above Target at 8.2% for September 2021

• The All-Jamaica Consumer Price Index (CPI) was 114.9, reflecting a 2.3% rise in consumer prices for September 2021. With the September outturn, the 12-mth point-to-point inflation rate was 8.2%, a significant increase from the 6.1% reported in August 2021 and puts inflation firmly above the BOJ’s 4-6% target range. 
• A 3.0% increase in the heavily weighted index for the “Food and Non-Alcoholic Beverages” division was a major contributor due in part to a 9.9% increase in the index for the class ‘Vegetables, tubers, plantains, cooking bananas and pulses. 
• Increases in the index for the divisions ‘Housing, Water, Electricity, Gas and Other Fuels’ (0.8%), ‘Transport’ (8.1%) and ‘Education’ (2.4%) also contributed to the overall inflation rate. 
• A 15.0% increase in bus, route taxi and hackney carriage fares granted by the Government also contributed to the rise in the index for the ‘Transport’ division. This movement was however tempered by lower petrol prices. Additionally, the index for the ‘Housing, Water, Electricity Gas and Other Fuels’ division moved upwards as a result of higher prices for electricity, water and sewage rates. 
• According to the Bank of Jamaica, inflation is projected to average between 5.5% and 6.5% over the next two years, above the previous projection of 4.8%. The inflation projection is driven primarily by a gradual rise in core inflation, supported by the lagged impact of higher international grains and shipping prices, a recovery in domestic demand and a temporary jump in inflation expectations.

(Source: STATIN and BOJ)