May 2011 Financial News

Inflation rate declines to 6.4%

May 28, 2011

The rate of inflation in the country has fallen again.

Data on retail prices released by the Central Statistical Office indicated that there was a sharp drop in headline inflation in April to 6.4 per cent (year-on-year) from 9.4 per cent in March, the Central Bank said yesterday.

Food inflation, which had ranged between 20-30 per cent since the beginning of 2011, declined sharply to 15.0 per cent (year-on-year) in April, the lowest rate of increase since May 2010.

"The easing of food inflation was mainly due to slower price increases for vegetables (18.5 per cent in April compared with 31.1 per cent in March), fruits (26.5 per cent compared with 31.4 per cent in March) and meat (9.9 per cent compared with 10.7 per cent in March). However prices accelerated for fish (12.1 per cent), sugar and confectionery (5.6 per cent) and bread and cereals (1.3 per cent)," the Bank said in a statement.

Core inflation, which excludes food prices, fell to 1.3 per cent (year-on-year) in April from 2.7 per cent in March.

This has been the first time since 2004 that the core inflation rate has fallen below 2.0 per cent, the Bank said.

"Overall, underlying inflationary pressures appear well-contained for the time being. Nonetheless, the Bank remains cautious about the inflation outlook and considers the risks to be still tilted towards the upside as credit demand picks up and international energy and food prices continue to surge.

"In these circumstances, the Bank has decided to maintain the Repo rate at 3.25 per cent," the statement added.


Source:
Trinidad Express
Saturday May 28, 2011

http://www.trinidadexpress.com/business/Inflation_rate_declines_to_6_4_-122762204.html