Jul 2010 Financial News

Central Bank of Barbados: Inflation rate drops to 3.3 per cent

Jul 16, 2010

THIS week the Central Bank of Barbados announced an inflation rate of 3.3 per cent.

And should the rate hover around that figure for the remainder of this year it would perhaps be the lowest in recent times.

On Tuesday the Bank said that for the period to March this year, inflation was 3.3 per cent, compared to the 8.6 per cent for the corresponding period a year earlier.

In his review of the economy Dr. Delisle Worrell, the Governor of the Central Bank of Barbados said that the inflation rate for the 12 months ended March had remained steady at the quoted figure.

Over the years inflation has trended upwards and this has forced Barbadians to call for urgent action to bring down prices.

In 2005 the inflation rate was 6.1 per cent, and the following year it shot up to 7.3 per cent before falling to four per cent in 2007.

However, it was back up to 8.1 per cent in 2008.

Much of the high inflation in Barbados has stemmed from the increasing cost of energy occasioned by the international price for oil which had reached record levels at US$149 a barrel in July 2008 before plummeting to under US$50 a barrel.

It has started to creep back up and the last quoted price was US$79 a barrel.

In looking ahead Dr. Worrell said that there may be an increase in energy prices which would result in a rising tendency in the inflation rate.

Apart from inflation the higher oil prices have also been impacting on this country’s external position.

In the review he said that foreign debt service and a rise in the value of imported and other intermediate inputs caused the largest increases in foreign payments in the first half of this year.

The latest news on prices showed that the Index of Retail prices for April 2010 stood at 142.2 points which represent an increase of 0.9 per cent when compared with march’s 2010 index.

The Barbados Statistical Service said that all but one of the categories of items – Clothing and Footwear – making up the basket of goods and services reported increases.

According to the BSS, Food increased 0.5 per cent, Alcoholic Beverages and Tobacco were up 0.2 per cent, Housing 0.5 per cent, Household Operations and Supplies 1.6 per cent, Transportation 2.2 per cent, Medical and Personal Care 1.4 per cent, and Education, Recreation and Miscellaneous 0.4 per cent. (JB)


Source:
Barbados Advocate
Friday July 16, 2010

http://www.barbadosadvocate.com/newsitem.asp?more=business&NewsID=11413