Country Report Jamaica
- ID: 2105438
- February 2016
- Region: Jamaica
- 24 Pages
- The Economist Intelligence Unit
Consumer prices edged upwards by 0.2% in December 2015, according to the latest data from the Statistical Institute of Jamaica (Statin). This brought year-end inflation to 3.7% for 2015.
Inflationary pressures remained muted at year-end. The monthly increase in December owed primarily to increases in food prices, with local food prices rising as a result of drought conditions currently affecting the Caribbean. Prices for meat and vegetables, and starchy foods each increased by 0.5%, driving up the index for food and non-alcoholic beverages by 0.4% for the month. However, as in much of 2015, higher food prices were offset by falling global energy prices. As a result, the category for electricity, gas and other fuels fell by 1.3% over the month.
The year-end inflation rate of 3.7% was the lowest level in almost 50 years. The lower rate owed to two months of disinflation at the start of the year, and the effect of a lower oil price on the oil-importing country. By contrast, the average year-end inflation rate for the previous ten years was 10.7%. The lower inflation rate has managed to slow the erosion of purchasing power that has occurred in recent years as a result of wage freezes and high inflation. This has proven a boon to political stability, and has become a factor in the ruling People's National Party's decision to hold early elections.