Point-to-Point Inflation Inches Higher; 6.3% in June

  • For June 2023, the All-Jamaica Consumer Price Index (CPI) increased by 1.0% when compared to the previous month. The point-to-point inflation rate for the month was 6.3%, indicating that inflation has accelerated slightly over the last month.
  • This upward movement was influenced by an increase of 1.3% in the index for the heaviest-weighted division, ‘Food and Non-Alcoholic Beverages’. Additionally, the inflation rate for June was also influenced by the divisions, ‘Restaurant and Accommodation Services’ up by 4.2% and ‘Furnishings, Household Equipment and Routine Household Maintenance’ increasing by 6.4%. The inflation rate was, however, tempered by a decline of 0.8% in the index for the ‘Housing, Water, Electricity, Gas and Other Fuels’ division due to the reduction in the rates for electricity, water and sewage.
  • The point-to-point inflation rate (June 2022 – June 2023) was 6.3%. This was influenced mainly by the point-to-point inflation rate for the divisions: ‘Food and Non-Alcoholic Beverages’ (10.3%), ‘Restaurants and Accommodation Services’ (12.8%) and ‘Furnishings, Household Equipment and Routine Household Maintenance’ (11.4%). For the fiscal year-to-date the inflation rate was 1.6%.
  • The chief contributor to the rise in the point-to-point index for the division ‘Food and Non-Alcoholic Beverages’ was the class ‘Vegetables, tubers, plantains, cooking bananas and pulses’, which increased by 23.4%. A 12.9% rise in the index for the group ‘Food and Beverage Serving Services’ was the primary factor that influenced the increase in the index for the division ‘Restaurants and Accommodation Services. Additionally, the ‘Furnishings, Household Equipment and Routine Household Maintenance’ was impacted by a 14.0% increase in the index for the group ‘Goods and Services for Routine Household Maintenance’.
  • The overall point-to-point inflation rate was tempered by the fall in the index for the ‘Transport’ division, a result of lower cost for fuels, with the index for the class ‘Fuel & lubricants for personal transport equipment’ decreasing by 13.0%.
  • On June 29, 2023, the BOJ held its monetary policy meeting, where it was deemed appropriate to maintain the policy rate at 7.0% and watch the pass-through effects on deposit and loan rates. Point-to-Point inflation is projected to continue to fall and enter the BOJ’s target range of 4.0% to 6.0% by the December quarter. The next policy decision will be on the 19th of August; it is expected that BOJ will maintain its policy rate at 7.0%. 

(Source: STATIN)