Consumer Prices Edge Higher in July, But Annual Inflation Slips Further

• After declining in June, local consumer prices for July 2025 rose by 0.3%; however, point-to-point (P2P) inflation fell to 3.3% from 3.8% for June, according to the Statistical Institute of Jamaica (STATIN). This marks the second consecutive month that inflation is falling below the lower band of the Bank of Jamaica’s target range.
• The monthly increase was mainly due to a 0.9% rise in the index for the ‘Food and Non-Alcoholic Beverages’ division. Within the division, the index for the ‘Food’ rose by 0.9%, while the index for the ‘Non-Alcoholic Beverages’ increased by 0.4%. The increase in the ‘Food’ division reflects higher prices for agricultural produce, including vegetables and tubers.
• The inflation rate for the month was also influenced by an upward movement of 0.4% in the index for the ‘Transport’ division. This was due mainly to a 1.4% increase in the index for the group ‘Operation of Personal Transport Equipment’, primarily driven by higher petrol prices.
• The overall rate of inflation was moderated by a 0.8% decline in the index for the ‘Housing, Water, Electricity, Gas and Other Fuels’ division. This resulted from a 2.9% fall in the index for the group ‘Electricity, Gas and Other Fuels’ due to lower electricity rates owing to a reduction in general consumption tax on electricity.
• With the July price decline, the P2P inflation rate for the period July 2024 to July 2025 was 3.3%. This was influenced mainly by the point-to-point inflation rates for the divisions: ‘Food and Non-Alcoholic Beverages (3.7%), ‘Housing, Water, Electricity, Gas and Other Fuels’ (3.7%) and ‘Restaurant and Accommodation Services’ (6.3%).
• The continued decline of inflation below the BOJ’s 4.0%–6.0% target range creates a favourable condition for the BOJ to accelerate rate cuts in order to realign monetary conditions with its inflation mandate and support economic activity.

(Sources: STATIN, Bank of Jamaica, NCBCM Research)