March 17, 2022
Outline
According to STATIN (The Statistical Institute of Jamaica), the Consumer Price Index for February 2022 was 118.4, up 0.8 per cent from January 2022 which closed at 117.6. The upward movement was primarily attributable to a 1.3 per cent increase in the index of the heavily weighted ‘Food and Non-Alcoholic Beverage’ division. The main contributor to the uptick in the division was a 2.2 per cent increase in the index for the subgroup ‘Meat and other parts of slaughtered land animals’ due to increased prices for chicken products. Another contributor to the upward movement in the division was a 1.0 per cent increase in the index for the subgroup ‘Vegetables, tubers, plantains, cooking bananas and pulses’ as prices increased for some vegetables. However, the movement in this class was moderated by the fall in prices for some starchy produce. The monthly inflation rate was also influenced by a 0.9 per cent increases in the indices for the divisions ‘Housing, Water, Electricity, Gas and Other Fuels’ as well as ‘Transport’. For the former, an increase in the rates for electricity, water and sewage were the main factors contributing to the increase, while higher prices for fuels were responsible for the rise in the ‘Transport’ division.
The point-to-point inflation rate was 10.7 per cent and the fiscal year-to date inflation rate was 10.1 per cent as at February 2022. Additionally, The Greater Kingston Metropolitan Area experienced inflation growth of 0.9% while Urban Centers Rural Areas both experienced inflation growth of 0.8%.
Major CPI Division Movements
The index for the ‘Food and Non-Alcoholic Beverages’ division increased by 1.3 per cent for February 2022. The upward tick was primarily influenced by a 1.3 per cent increase in the index for the ‘Food’ subgroup with the main contributor being a subgroup within the subgroup, ‘Meat and other parts of slaughtered land animals,’ moving up by 2.2 per as a result of a rise in prices for chicken products. Additionally, there was a 1.0 per cent increase in the index for the class ‘Vegetables, tubers, plantains, cooking bananas and pulses’. This upward movement was influenced by higher prices for vegetables such as tomato, onion and cucumber. However, lower prices for yam, plantain and potatoes tempered the movement of this class. Other classes within the ‘Food’ subgroup registering notable increases were: ‘Cereals and cereal products’ (0.7%), ‘Fish and Seafood’ (1.2%), and ‘Fruits and nuts’ (1.5%). The index for the subgroup ‘Non-Alcoholic Beverages’ increased by 1.0 per cent and subgroups within the subgroup, ‘Water, Soft drinks, and Other non-alcoholic beverages’ and ‘Coffee, Tea & Cocoa’ saw a 0.9 per cent and 1.1 per cent increase respectively. The point-to-point inflation rate for this division was 12.8 per cent, while the fiscal year-to-date inflation rate was 12.0 per cent for the Division.
The index for the ‘Housing, Water, Electricity, Gas and Other Fuels’ division experienced a 0.9 per cent increase in February 2022. The index for the subgroups, ‘Water Supply and Miscellaneous Services Relating to the Dwelling’ and ‘Electricity, Gas and Other Fuels’ increased by 3.8 per cent and 1.3 per cent respectively. These movements were due mainly to increased rates for water, sewage and electricity. The ‘Maintenance and Repair of the Dwelling’ subgroup also recorded an increase in its index of 1.0 per cent due to higher wages for carpenters, masons, painters, plumbers and electricians. The point-to-point inflation rate was 10.4 per cent, while the fiscal inflation year-to-date was 10.0 per cent for the review period.
The index for the ‘Alcoholic Beverages, Tobacco & Narcotics’ division increased by 0.7 per cent in February 2022, primarily owing to a 1.0 per cent increase in the index for the group ‘Alcoholic Beverages’ due mainly to higher prices for ‘Beer’. For this division, the point-to-point inflation rate was 6.2 per cent, while the fiscal year-to-date inflation rate was 5.6 per cent as at February 2022.
The index for the ‘Health’ division, increased by 0.4 per cent. This movement was due to the 0.4 per cent increase in the index for the subgroup ‘Medicines and Health Products’ as a result of increased prices for some over-the-counter and prescription drugs. Also impacting the movement of the division was the 0.5 per cent increase in the index for the subgroup ‘Outpatient Care Services’. The point-to-point inflation rate was 4.0 per cent and the fiscal year-to-date inflation rate was 3.3 per cent.
A 0.9 per cent increase was recorded in the index for the ‘Transport’ division. This upward movement was mainly attributable to higher costs for ‘Fuels and Lubricants for personal transport equipment’ which rose by 4.7 per cent owing to the widely reported increases in petrol prices due to the Ukraine-Russia War. The point-to-point inflation rate was 14.2 per cent, while the fiscal year-to-date inflation rate was 13.3 per cent.
The index for the ‘Recreation, Sport and Culture’ division, increased by 0.3 per cent. The marginal uptick was due to increases of 0.2 per cent and 0.3 per cent in the index for the subgroups ‘Garden Products and Pets’ and ‘Newspapers, Books and Stationery’ respectively. For this division, the point-to-point inflation rate was 5.4 per cent and the fiscal year-to-date inflation rate was 5.1 per cent.
The index for the ‘Restaurants and Accommodation Services’ division rose by 0.2 per cent in the month of February. A 0.2 per cent increase in the index for the subgroup ‘Food and Beverage Serving Services’ influenced the increase. There was also a 0.8 per cent rise in the index for the subgroup ‘Accommodation Services’. For this division, the point-to-point inflation rate was 20.2 per cent and similarly, the fiscal year-to-date inflation rate was 20.2 per cent as at February 2022.
The index for the ‘Furnishings, Household Equipment and Routine Household Maintenance’ division rose by 0.6 per cent for the review period. This was due mainly to the 0.7 per cent increase in the index for the subgroup ‘Goods and Services for Routine Household Maintenance’ due to increased prices for some household non-durables such as laundry soaps, bleach, detergents and other cleaning products. All other groups in the division registered increases in their index notably: ‘Furniture, Furnishing and Loose Carpets’ (0.3%) and ‘Household Appliances’ (0.4%). For this division, the point-to-point inflation rate was 5.8 per cent and the fiscal year-to-date inflation rate was 5.2 per cent.
The inflation rate for ‘Personal Care, Social Protection and Miscellaneous Goods and Services’ was 0.8 per cent. Increases were recorded within this division and resulted in the index for the groups ‘Personal Care’ moving upwards by 0.8 per cent and ‘Other Personal Effects’ up by 0.6 per cent.
Individual divisions saw the following changes:
- Food and Non-Alcoholic Beverages: (+ 1.3 %)
- Alcoholic Beverages, Tobacco and Narcotics: (+ 0.7 %)
- Clothing and Footwear: (+ 0.3 %)
- Housing, Water, Electricity, Gas and Other Fuels: (+ 0.9 %)
- Furnishing, Household Equipment and Routine Household Maintenance: (+ 0.6 %)
- Health: (+ 0.4 %)
- Transport: (+ 0.9 %)
- Information and Communication: ( 0.0 %)
- Recreation, Sport and Culture: (+ 0.3 %)
- Education: (0.0 %)
- Restaurants and Accommodation Services: (+ 0.2 %)
- Insurance and Financial Services (+ 0.0 %)
- Personal Care, Social Protection and Miscellaneous Goods and Services: (+ 0.8 %)
Disclaimer:
Analyst Certification -The views expressed in this research report accurately reflect the personal views of Mayberry Investments Limited Research Department about those issuer (s) or securities as at the date of this report. Each research analyst (s) also certify that no part of their compensation was, is, or will be, directly or indirectly, related to the specific recommendation(s) or view (s) expressed by that research analyst in this research report.
Company Disclosure -The information contained herein has been obtained from sources believed to be reliable, however its accuracy and completeness cannot be guaranteed. You are hereby notified that any disclosure, copying, distribution or taking any action in reliance on the contents of this information is strictly prohibited and may be unlawful. Mayberry may effect transactions or have positions in securities mentioned herein. In addition, employees of Mayberry may have positions and effect transactions in the securities mentioned herein.