Consumer Prices Fall in January 2025

Consumer prices fell 0.3% in January 2025, with the All-Jamaica Consumer Price Index (CPI) falling from 143.5 in December 2024 to 143.1 in January 2025.
This downward adjustment was primarily driven by a 1.3% reduction in the heavily weighted index for the division ‘Food and Non-Alcoholic Beverages’, influenced mainly by a 7.4% fall in the ‘Vegetables, tubers, plantains, cooking bananas and pulses’ class. Lower prices for some agricultural produce, as production improved, was the primary driver of the falloff in this subgroup.
Also contributing to the downward movement in the CPI for January was a 0.3% decline in the index of the ‘Housing, Water, Electricity, Gas and Other Fuels’ division due to lower electricity rates which led to a decline in the ‘Electricity, Gas and Other Fuels’ group.
Reflecting the lower consumer prices during the month, the point-to-point inflation rate for January 2024 to January 2025 declined to 4.7% from 5.0% in December. The divisions making the largest contribution to the point-to-point inflation rate were ‘Food and Non-Alcoholic Beverages’ (+7.4%), ‘Housing, Water, Electricity, Gas and Other Fuels’ (+2.0%), and ‘Restaurants and Accommodation Services’ (+6.2%).
The latest CPI reading continues to support the Bank of Jamaica’s (BOJ’s) expectations that inflation will remain anchored within its target range of 4%-6% over the next eight quarters. The BOJ’s stable inflation outlook supported its 25 basis points (bps) cut to 6.00% on December 20^th. The next policy decision will be on the 20th of February and the market expects an additional 25bps cut.

(Sources: STATIN & NCBCM Research)