JAMAICA’S inflation eased to its lowest level in nearly two years during March as the c0sts of gasoline, electricity, water, and sewage declined enough to offset an increase in the price of some food products and restaurant meals.

The Statistical Institute of Jamaica said Monday that consumer prices rose just 0.1 per cent from February to March, down from 0.5 per cent from January to February.

Measured from a year earlier, prices were up just 6.2 per cent in March, down sharply from February’s 7.8 per cent year-over-year increase and the mildest such rise since August 2021 when prices rose by an annual rate of 6.1 per cent.

“This is a major positive for the Bank of Jamaica,” Kwame Brooks, country treasurer for the JMMB Group, told the Jamaica Observer. Brooks said with March’s inflation just outside the Bank of Jamaica’s (BOJ) targeted four to six per cent range, the central bank “is expected to maintain rates at current levels of 7.0 per cent at the next monetary policy committee meeting in May”.

Much of the lower inflation has been due to the impact lower fuel prices have had on the cost of everything from electricity to petrol. Between February and March alone, electricity prices declined 4.2 per cent while petrol prices fell 1.4 per cent. Even the price of food — which rose in March due to higher costs for things like cabbage, Irish potatoes and sweet potatoes — recorded smaller annual increases compared to three months ago. Food prices, which went up 12.7 per cent year over year in January, were up 10.1 per cent in March.

Yet, heading into the hurricane season, Brooks worries that a storm could change the trajectory if floods affect the agricultural production or if the meteorological drought affecting the island prolongs more than expected.

“The BOJ is expected to closely monitor the data into the summer months and act as warranted. Once [the] consumer price index is sustained in the target range the BOJ may even look to reduce rates later this year. There are, however, upside risks to inflation such as extreme weather conditions and geopolitical factors,” Brooks continued.