A sharp reduction in electricity rates helped push Jamaica’s inflation lower in June, with the consumer price index (CPI) falling by 0.3 per cent for the month and point-to-point inflation slowing to 3.8 per cent, the-lowest annualised rate in over a year.

The decrease in electricity costs followed a Government-led reduction in the general consumption tax (GCT) on residential light bills, triggering a 3.5 per cent fall in the index for electricity, gas, and other fuels. As a result, the broader ‘Housing, Water, Electricity, Gas and Other Fuels’ division registered a 1.5 per cent decline, significantly influencing overall price movements. Effective May 1, 2025, the GCT on residential electricity bills was reduced from 15 per cent to 7 per cent, applying to all usage for both prepaid and postpaid customers. Additionally, households consuming 250kWh or less received a further 3 per cent government subsidy on their electric bills.

Data released by the Statistical Institute of Jamaica (Statin) on Tuesday showed that food prices also trended downward, slipping by 0.3 per cent in June. Consumers benefited from lower prices for agricultural produce such as ripe banana, pineapple, sweet potato, pumpkin, and tomato. The index for ‘Fruits and nuts’ declined by 4.9 per cent, while ‘Vegetables, tubers, plantains, cooking bananas and pulses’ fell by 0.8 per cent.

Offsetting these declines was a 1.4 per cent increase in the ‘Furnishings, Household Equipment and Routine Household Maintenance’ category. The rise was mainly driven by a 6.7 per cent increase in the national minimum wage, effective June 1, which led to higher costs for routine household services.

Over the 12-month period ending June 2025, the 3.8 per cent inflation rate marks a continued easing of price pressures, down from 5.2 per cent in May. At its peak over the past year, inflation climbed to 6.5 per cent in August 2024.

Despite the softening trend, some categories remain elevated. food and non-alcoholic beverages rose by 4.7 per cent year over year, housing and utilities climbed by 4.6 per cent, and restaurants and accommodation services were up by 6.1 per cent. Still, the overall trajectory indicates a cooling in consumer price pressures.

For the calendar year to date, Jamaica has recorded deflation in three months — February, April, and June — balanced by three months of inflation. The most inflationary month during the 13-month review period was August 2024, which saw a 2.4 per cent increase linked to back-to-school and summer demands.

Islandwide, prices fell by 0.3 per cent in both the Greater Kingston Metropolitan Area and rural areas, while other urban centres remained flat in June.

With inflation trending downward and key cost categories, particularly electricity and food showing signs of softening, the latest data could offer some relief to Jamaican households and signal potential room for monetary policy adjustments in the months ahead.

— Karena Bennett