Point to Point Inflation Declines to 9.3% for September

• For September 2022, the All-Jamaica Consumer Price Index (CPI) increased by 1.4%.
• However, September’s point-to-point inflation fell to 9.3%, sustaining the downward trend forecasted by BOJ for H2 2022. Notably, the figure represents the lowest point-to-point inflation figure since the beginning of 2022.
• For September, the rise in monthly inflation was largely driven by the 4.1% increase in the index for the division ‘Housing, Water, Electricity, Gas and Other Fuels’ owing to the cessation of the Government of Jamaica’s (GoJ) 20.0% subsidy on electricity bills for customers who use 200 kilowatts per hour or less
• On November 18, 2022, the BOJ will host its next monetary policy meeting at which it is anticipated that it will continue to raise rates.  However, if the inflation rate continues to decline the central bank could temper its rate hikes from the previous 50bps movements to 25bps. This would carry the policy at or above 6.75%, from the current rate of 6.50%. This decision will be driven by the sustained expectation for future breaches in the inflation range, more aggressive Fed hikes and the still elevated inflation expectations for 12 months ahead, which rose to 12.6% in the August Survey from 13.1% in the prior survey.

(Sources: STATIN and NCBCM Research)